Full text of Commercial and Financial Chronicle : September 18, 1952, Vol. 176, No. 5152

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university
OF

MICHIGAN

1952

b lf1 i
BUSINESS

ESTABLISHED 1S39

IBKimsmilOH
library

Reg. U. 8. Pat. Office

Number 5152

Volume 176

EDITORIAL

New York, N. Y.,

Thursday, September 18, 1952

Price 40 Cents

Copy

The Aircraft Industry

We See It

Today

"Trade, Not Aid ?"

By ROSWELL L. GILPATRIC*

By MELCHIOR PALYI

Undersecretary of the Air Force

Dr.

The

generally unexpected results of the Wis¬
primary last week has brought into sharper
focus than ever an "issue," or at all events a
controversy, which has from the first seemed to

Mr. Gilpatric reveals state of the aircraft
industry in the
nation, stressing its large volume of business and $11
billion backlog of orders. Presents data on

consin

to be

of the

one

recent

which

political

evidence of much

weight is produced,
h4s become a sort of catchword.
Among those
who have developed hypertension over this matter
are included
some, doubtless, whose record will
not bear too close
scrutiny. But there are others
who naturally and
rightly and seriously object to
the type

Senator

of defamation

All this is

the

sort

same

dates

for

States.

are

campaign

aside very

can

and many

that

President

conditions

which,

industry

theme

efficient

by McCarthyists,

doubt that

others who

statistics

lery

the

Air

Force
have

not

the aircraft

the

build-up
complete
com¬

tactics this

represented

will try

decline

the

90%

from

the

1952, these

SECURITIES

President

Not

behalf

the

page

means

producer

into the

most

our

trade

takes

many

pressure

deals

Underwriters, dealers and investors in

page

cor¬

State and

WESTERN
Pacific Coast &

Municipal

OIL & MINING

Hawaiian Securities

BANK & TRUST

■

Bonds

SECURITIES

Wires

Dean Witter
14 W.11

COMPANY

Street, New York, N. Y.

THE NATIONAL CITY BANK

ESTABLISHED

San

OF NEW YORK

Security Exchanges

Francisco

Los Angeles

•

Boston

•

Chicago

50 BROADWAY

Dept. Teletype: NY 1-708

Los

NATIONAL BANK
Public Service
on

Request

the

Government

Office:

26,

London, E. C. 2

Banff

York

Stock
Curb

Exchange

Paid-up
Reserve

30 Broad St.

New York 4
Tele. NY 1-733

Capital

__£4,562,500
£2,281,250

Fund

and

description of

exchange

business.

Trusteeships and Executorships
also undertaken

CHASE

other

Western

NATIONAL
OP THE CITY

BANK

OF HEW

YORK

Cities

Puget Sound

CANADIAN
BONDS & STOCKS

Power &
Analysis

Light Co.

upon request

Bought—Sold-—- Quoted
CANADIAN

DEPARTMENT

Goodbody

£3,675,000

The Bank conducts every

banking
Tel. DIgby 4-7800

Protectorate.

Authorised Capital

Denver
Spokane

Oils, Ltd.

Branches

land

York

Husky Oil
Refining, Ltd.

Natural Gas Co., Ltd.

Bishopsgate,

in India, Pakistan,
Ceylon,
Burma, Aden, Kenya, Tanganyika,
Uganda, Zanzibar, and Somali-

Hardy & Co.

NEW YORK CITY

Peace River

Kenya Colony and Uganda
Head

Circular

of INDIA, LIMITED
Bankers

•

Angeles
and

General

THE

1915

Members cf All Principal Exchanges

Salt Lake City

Bond

Honolulu

Department

J.A.H0GLE & CO.
'

and

30 BROAD ST., N. Y.

Bond

Co.

Members of Principal Commodity

bond department

New

corrupt

politics. And it eliminates the vicious circle of industrial

Chemical

Members

ex-:

porate securities are afforded a complete picture of issues now registered with the SEC
and potential undertakings in our "Securities in Registration"
Section, starting on page 41.

Direct Private

New

and

groups

Lastly, free

tariff, I'll vote for yours"—out of

Continued

—

channels,

HAnover 2-3700

telephone:

Members

productive

advantage also because they allow

—"you vote for

by Mr. Gilpatric before the Air Force Associa¬

REGISTRATION

Palyi

Dr. Melchior

ports of the genuine, non-subsidized kind.

U. S. Government,

Securities

extension

Slate and

Mu¬

Security Administration.

tion, Detroit, Mich.

NOW

the

healthy division of labor between nations. More imports

are

appropriated for aircraft and related

address

that

breaks up sticky monopolistic structures, and brings about

$11 billion, which only included part

—

the

chancel¬

reverberates

"Trade,

domestic

over

•From

protectionism
is

European

fairness
in
international
relations; fairness to the
domestic consumer who can buy in
the cheapest market.
It forces the

companies had

year.

War

of the $16 billion

idea

hopeless mess, it

borders;

essen¬

page

American

The

are

an¬

Butler.

commercial

1946, which

World

Continued
on

recent

free competition beyond the national

$2V2 billion of business during 1951.

beginning of

backlog of

over

advocates.

peak of 1944, to

with keep¬

Continued

DEALERS

total

uine believers in free

grown from its nadir of 3/4 billion dollars in

motto

Free
trade, of course, is sound
economics, which explains why gen¬
enterprise are
inclined to join the "Trade, Not Aid"

industry, but

Electric, Allison and Westinghouse)
illustrate the points I want to make. The
volume of business of these 15
companies has

serve

song.

and

tual

turers" like General
will

the Administration

power

the

was

through the
Aid," echoed
Ambassador Draper in his report to

panies comprising the major units in
Gilpatric
the industry that are almost excluT
sively engaged in some phase or another of aircraft
manufacturing (excluding so-called "mixed manufac¬

waved
some

Aid,"

by the British Exchequer's Mr.

because

press.

it stands today,
supporting the

years

the sales and earnings of the 15

"red herrings."

are concerned

ing the Democratic party in
same

Not

agenda of every

production.

industry

and

programs.

during the

was

Truman

serious charges, among them

those made

tially the

stable

aircraft

two

Navy

certain rather vital matters here which

all too often overlooked.

There

firm program should

about

the

after

political aspects of this situation, but

there

encouraging United States "handouts."'

"Trade,

for the

the

of most European nations. Hints
U. S. tariff are a new formula for

means,

against

}

That brings me to the state of the

with

1948

such

aircraft

may have a very direct and vital bearing upon
the welfare of this
country, we have no concern

are

The existence,

and economical

caus¬

Save

attacks

Europe's international accounts

to Mr. Eisenhower—the

in their

"nefarious"

supporting

turn, should make for

reelection

minor factor in the imbalance

years.

bring

are one or two other
Repub¬
given in one degree or another to
of thing and who are now candi¬

are

payments, and lays main blame on
financial policies, combined with a living

beyond their

are

international

gan, of

since there

licans who

nouncement

supposed to have caused and be

first time since the Korean War be¬

McCarthy.

ing much embarrassment

American tariffs

relatively firm basis for
scheduling production over the next
three

demands of European
Britain, for elimination of

attention

as a means of curtailing dollar short¬
Though not upholding protectionism, he points out

age.

the Air Force FY '53
budget,
with its provision for financing
average lead time of two
years for aircraft manufacture, has placed the Air Force
in a position to extend to the aviation and its
industries

dear to the heart of

Congressional action

calls

American tariffs

profit mar¬
gins, and denies inadequate profit is strangling the indus¬
try. Urges holding down costs of aircraft and related
equipment, and calls for "more Air Force per Dollar."

strangest and most unrealistic
campaigns. "McCarthyism,"
which is apparently to be defined as the
practice
of making reckless
charges of serious nature for
of

Palyi

nations, particularly Great

Co.

ESTABLISHED 1891
MEMBERS NEW YORK STOCK EXCH.
115

BROADWAY

NEW YORK

NORTH

DortimoN Securities
GrPORATI071
40 Exchange

Place, New York 6, N. Y«

LA SALLE ST.

CHICAGO

ira haupt & co.
Members
and

Broadway, N. y. 6

WOrth 4-6000

Teletype NY 1-702-3

WHitehall 4-8161

Boston

York Stock Exchange
Principal Exchanges

New

other

111

Teletype NY 1-2708

Telephone:

Enterprise

1820

** ff

Financial Chronicle

The Commercial and
2

...

The

TRADE

Security I Like Best
week, a different group of experts
and advisory field from all sections of the country

in the investment

(The articles contained in this forum are not

they to be regarded, as an offer to sell the

are

American Gas & Electric

Common W.

Clearing Machine Corporation
the

Florida Power Corp.

submitted by
interesting
conducted by the "Chron-

articles

when

forum

Northwestern Public Service

icle,"

and

New York Hanseatic

Curb Exchange

Associate Member N. Y.

Teletype NY 1-583

BArclay 7-5660

Specialists in

ffipONNELL&fO.
Members

New

120

Stock Exchange

York

Tel.

Exchange

Curb

YORK 5

NEW

BROADWAY,

2-7815

REctor

Hiiiiiiiiiimiiiiiiiimiiiimiiiiiiiiiiir

nition

auto manufacturer
its customers. A

percentage

primarily

producing

offices

engi¬

This has been
favorable recep¬

very

Circular

request

The whole picture

hearten¬

ing one for Clearing stockholders.
As able President R. W. Glasner

cost-reduction

HOFFM/N RADIO

rate twice as fast as

remarked

tremendous

the

annual

1951

re¬

"With increased technologi¬

improvements and ingenuity,
growth of our business

further
and

market

The

wider

ever

around

great faith in its

engineering capa¬

its

dynamically pro¬

and

bilities

the

same

forced

are

pass

stocks

"name"

glamor

& Rights

Common

♦Prospectus

Rights

request

factors
situation,

Thus,
the
and th*»

potentialities exist.

similar

Paper

1977

favorable

evident in the Clearing

Utah Power & Light

gressive management. The stock
later was placed on a $1.50 annual
dividend basis and sold above 20.
With

Scott

Foote Mineral

having

share,

Conv.

Engineering

Aetna-Standard

stock

years

strongly
of

of Clearing prod¬

ago.
the writer
recommended purchase

few

WOrth 4-5000

unlimited.

ucts remains

Teletype BS 259

Telephone

from

possibilities

use

State St.. Baston 9, Mass.

148

Tel. CA 7-0425

industry seems assured."

our

1.000 persons are employed favorites of the funds in favor of
Clearing Machine for its specula¬
in hs plants,
it may well be
In 1951, a term loan of $2,500,- tive possibilities over the next
glamorous growth stocks — the 090 was arranged, and at present year or so. In the writer's opin¬
wonder drugs, the wonder metals, $2,300,000 of this amount is out- ion, this stock offers real value at
even
the oils
have "seen the standing, ahead of only 530,000 prevailing prices.
show."
Looking over Clearing's shares of common stock. Finances
DONALD M. LIDDELL, JR.
corporate report card, it shows are strong, with $5,938,736 of net
Executive Vice-President,
that although the earnings and working capital outstanding (Dec.
Templeton, Dobbrow & Vance, Inc.,
stock prices of most companies 31, 1951); cash alone amounted to
Englewood, N. J.
fell abruptly from the fall of 1946 $1,711,412. Book value of the stock
on, the year 1947 was Clearing's
now amounts to approximately American Crystal Sugar Common Stock
best.
In that year, the company $13.65 a share, up steadily from
For many years the production
earned $4.23 a share, as against the $1-81 a share reported at the
of sugar beets has been important
$2.92 in 1946, paid $2.50 a share end of 1938.
after

mark

branch

our

tion in the trade.

cal

equipment

perfected a press
body
com¬

auto

forms

accorded

port:

its

276

older type presses.

emphasized

b°nn and its services are eagerly
is a
sought.
current choice, but there are exClearing has one large modern
cellent reasons for believing that plant in Chicago with an area of
a
potential considerably higher 204,000 square feet. In August of
than
the
prevailing
quotation 1951, it purchased a plant of 93,around 93/4-10y4 exists for Clear000 sauare feet at Hamilton, Ohio,
ing Machine Corporation.
for $850,000, to machine and asIt may seem somewhat strange semble small parts for company
to select a speculative, cyclical isproducts and make small presses,
sue, but this stock has no excesses A 50%-owned subsidiary, British
in
its present price to be liq- Clearing Machine Co., Ltd. was
uidated in a reactionary market, formed in 1946 to supply Clearing
it seems distinctly undervalued, products to foreign markets.
Toand its appreciation possibilities day> it's presses may be found in
would appear to far outweigh the South America,
throughout Eurisk involved at this point. With rope, in South Africa, Australia,
the Dow-Jones Averages hovering Japan and elsewhere., Currently,
the

wires

operating costs, servicing
In
addition,

time ago, it

some

by ever-increasing labor demands,

Ca^ey

Direct

maintenance.

and

machinery.
To
automobile and
other manufacturers, hard-pressed
Warren

NY 1-1557

effect

neering firm of world-wide recog¬

each.

around

Trading Markets

operation, reduces inertia
clutch parts by about

now

standpoint of time, this
little too much to expect of the

Since 1917

York

major

that Clearing is

four

Exchange

St., New York 4, N. Y.
La. - Birmingham, Ala.
Mobile, Ala.

From the

Rights & Scrip

25 Broad

HAnover 2-0700

Clear¬
plants he has

customer. It should be

pe¬

riod

months

York Curb

New

New Orleans,

ponents at

10 0%
a

York Stock Exchange

Members

wood, N. J. (Page 2)

of sales is for
equipment manufactured to the
specifications of the individual

large

Enamel

within

Members New

Vance, Inc., Engle-

Dobbrow &

which

and Fer-

rose

New

every

appreciated
r o

Steiner, Rouse & Co.

Vice-President, Templeton,

tive

included among

stock

66%

Broadway,' New York 5

—

Execu¬

omies in

h 1 i n

Steel

1920

Bought—Sold—Quoted

70% and brings about major econ¬

and

Co.

Sugar

Liddell, Jr.,

Donald

largest outlet is the
automotive industry, with almost

fortune

Jones

machinery

Crystal

American

being utilized in the

Clearing's

favoring,

Corporation

width.

toured.

of the
market
cycle
with

Established

ing

Philadelphia.

(Page 2)

frequency of installation of

phase

existed,

Warren

needed for the nation s defense
cannot be over-estimated. Durmg the past year or so, the writer
has been greatly impressed at the

dynamic

Light

Puget Sound Power &

this

lower

level

Hampshire

were

writer

the

Iowa Power & Light

previous occasions

two

Corporation—
A. Casey, Security Ana¬

lyst, Hecker & Co.,

military
effort, where their importance in
forging
the
sinews
of power
are

Philadelphia, Pa.

Louisiana Securities

intended to be, nor
securities discussed.)

high and 37 feet in

Alabama &

Selections

Machine

Clearing

present, many Clearing presses

Ilecker & Co.

Analyst,

Security

Colorado Interstate Gas

Public Serv. of New

CASEY

WARREN A.

Central Public Utility

45 feet

Week's

Participants and

Their

particular security.

participate and give their reasons for favoring a

Corp.

Metal & Thermit

5V2/52

This
Forum

A continuous forum in which, each

American Maize Products

120

»; ;

...

and

>'v>

Thursday, September 18,1952

(1010)

WE POSITION

some

GKHSTEN & FHENKEL
\others

130

Security

Dealer*

Assn.

New York 7

Broadway

Tel. NY 1-1932

Tel. Dlgby 9-1550

than three years of a

bull market,
that the more

American Furniture Co.
Dan River Mills

Hardware Co.

Moore Handley

—★—

Scott, Horner &
Mason, Inc.
Lynchburg, Va.
LD 33

Tele. LY 83

llllllllllllllllllllllllllllllllllllllllllll

now

not likely to

Chemical Corp.

Request

equal

Republic Investment Company, Inc.

six

first
STREET

LASALLE

SOUTH

CHICAGO 4

FRanklin 2-1150

Direct

Wire

Beane

Singer,

Inc.

Mackie,

months

the

same

spite
may

period

higher

costs

full

1952.

1856

the unforeseen,

York
York

New

York

New

Commodity
Chicago

Stock

Exchange

Curb

Exchange

Cotton

Exchange

Inc.

Exchange,

* Board

De-

taxes,' it

profits

excess

With

Trade

;

relatively young
company
(1933), this constantly
growing and profitable enterprise
Although

Members
New

and

current
backlog of $15,000,000, a rough
projection for 1953 would be in
the vicinity of $3 a share, barring

H. Hentz & Co.
*■

year ago.

$2,000,000 is of

over

considerable help.

un-

be possible to show earnings

tax credit of

are

share,
compared with 69c earned in

for

Established

$1.16 a
for the

1952

at $1.15

com-

of between $2.50 and $2.75 a

York

New

a share,
$613,775,. or
Earnings

1950.

officially stated
as

Telephone

Teletype
CG 2197—-CG 1614

with
in

$1,203,781,

$2.27

pared

Securities

Investment
231

net income of

extra a good possibility - at- the
year-end. The company has naid
1943, and

Machine

Clearing

year,

earned

Dividends are being paid at the
rate of 15c quarterly, with a 15c
•

the

economy

Mountain

area

......

Banks, Brokers & Investors

next year should

see

the Rocky
and
of certain
neighboring

& EXCHANGE
THOMAS D. JENKINS
Broker

The

509

Madison
PLaza

Ave., N. Y. 22
3-5282

Teletypes <r- TWX — N. Y. 1-2345
"TEX" (Gt. Britain & Europe) PKL-NY

industry is.
looked

with

higher quarterly rate established,

p o n

favor by

Congress on

At present, this seems to be the
the
grounds
only factor acting as a brake on
that a domesthe price of the stock, but the
tic
supply
management is being conservative
of
sugar
since it incurred last year's debt,
r e p r e s e nts
A comparison of statistics of
insurance
Clearing and E. W. Bliss, another
against
the
large
manufacturer of power
possibility
of
presses, shows that earnings have
being cut off
been closely parallel in recent
from the caneyears. Meanwhile, Bliss stock has Donald M. Liddell, Jr.
growing coun¬
hit a new high of 19y4 within the
tries in t i m e
past few days, or almost 100%
of war. Legislation now in effect*
higher than Clearing's price. In
designed, in part, to encourage,
fact, in
1947, Clearing earned
this
industry
and
to
maintain
$4.23 a share against Bliss' $3.11,
price stability by adjusting „sup-;
and last year earned $2.27 a share
against Bliss' $2.11.
Since 1943, ply to estimated demand, allots

Clearing's'earnings have averaged

FOREIGN SECURITIES

states.

be^ slowed down for out about 50% of earnings since

considerable time ahead.
Last

Circular

top of 14y4 in 1946.
seems to be rolling and is

against

in
at

against 46c
and Clearing stock sold

dividends,

1946,

Nuclear Instrument &

For

—

to such

quota

and

Producing, Refining

Distributing Company

Sioux Oil Co.
COMMON
Inquiries

STOCK
Invited

JAMES M. TOOLAN & CO.
67 WALL STREET
NEW YORK 5, N.
HAnover 2-9335

Teletype NY 1-2630

producers of beet sugar a

about

Over-the-Counter

1,800,000 tons a

$!-66 a share, as compared with year out of domestic consumption
Bliss' $1-71- Clearing has been of all types of sugar estimated at
is now the country's largest pro- the more liberal dividend- payer,
approximately
8,000,000
ton s.
ducer
of
giant
metal-working averaging 86c a share in that pe- Since actual
production normally
power presses.
These presses are riod against Bliss' 78c. It is sig- falls short of the allowable figure,
used
by
the
automotive,
rail nificant that Clearing has earned the beet sugar companies, which
equipment, household appliance, a profit in every year since 1936, are
primarily refiners rather than
aircraft, farm implement, plumb- tl^e first year of available records,
growers, are, in effect, guaranteed
ing ware and
other industries Every evidence points to the fact a market for their entire output
where the forming of metal con- that a very firm control over costs
at what probably should be a fair
stitutes an important part of oper- has been maintained at all times:
price.

Quotation Services
for 39 Years

New

Orleans
And

Cotton

other

Exchange

Exchanges

N. Y. Cotton Exchange

Bldg.

NEW YORK 4, N. Y.
CHICAGO

DETROIT

GENEVA,

PITTSBURGH

SWITZERLAND

ations.
from

These presses range in size
inclinable presses of

small

30 tons capacity to
ton

capacity

the giant 3.850press that is about

In recent years, Clearing Machine has developed a new "torna-

dyne"
clutch
and brake
unit
which, when installed in presses

American
pany

was

Crystal

Sugar Com¬

incorporated under the
Continued

page

National Quotation Borean
Incorporated
Established 1913

46 Front Street
CHICAGO

New York 4, N. Y.
SAN FRANCISCO

.Volume 176

Numbw 5152

The Covj_crcial and Financial Chronicle

(1011)

Mutual Funds and the SEC
By DONALD

IN DEX
Articles and News

Chairman Cook proposes new

rules for "institutional" literature
and says Commission is making survey of brokerage fees,
"reciprocal business" and loading charges. Though upholding
the investment company concept, Mr. Cook criticizes the busi¬
ness and selling practices of SGme of the mutual funds
organ¬

■free from

high level of

Points out present sales literature is

contains

I had the pleas¬ realize the largest commission or
appearing, before you to greatest incidental advantage, ra¬

discuss the Commission's then
Statement of

certain
ards

new

Policy which set

stand¬

than

best

one

suited

lit¬

circumstances, he is defeating the

used

inves tment

curities.

that

time

mer.

For

viding

as¬

about

know

cases

felt

the

which

ap*

Donald C. Cook

plication

Policy would so
selling efforts that

funds would

wither

commission

applicable.

this

done

only because in that way
they would receive the maximum
possible sales commission.

die.

and

Dictatorship of

Wilson

Banff Oil*

Few Powerful Men!
11

•

■

Natural

Gas & Oil

Prospects for Free Power—Roger W. Babson

17
18

Economic Nationalism

».—Michael

•

Tennessee

Production*

Obstacle to Free World Unity

Heilperin

•

Blue Sky Legislation—A
Lawyer's Viewpoint,:

—Roger L. Severns

—Hon.

A Nation-Wide

Survey

George Prudham

World-Wide Devices to Help the Saver
Against Inflation
—Charles R. Stahl

J. F.

believe

that

panies

investment

live

com¬

to their
high aims and provide the
kind of service that they purport
to provide, then more careful con¬
sideration

are

stated

the

must

character

given both to

Incorporated
61

Broadway, New York

BO 9-5133

New

Investing Course Announced

"Difficult Decade" Facing
Hear!

Hear!

Estimates

Federal Reserve

Philadelphia

Payroll

Costs

Suspends Regulation X

personnel
and their business practices. Two

lack of confidence in the theoreti¬

cal

Associated

which investment companies state

of my

some

soundness

Rather,

said the last time

before

it is be¬
firmly believe in the in¬

you,

vestment

company
concept, but
that only under the prudent
and conservative guidance of men
feel

conscientiously fulfilling their du¬
ties

their

for

trustees

the

share¬

holders, will investment companiesplay the role in our economy
they merit.

their

find

labyrinth
nancial

investment

the

through

way

fi¬

modern-day

world.

and

for

investment advice
an

and

investment

medium which will suit their in¬
dividual
is

the

needs.

avowed

mutual funds.
not

of most
regret it can¬

purpose

But I

said that they fully
their responsibilities in this

yet

meet

this need

fill

respect.
Sometimes

the

investor

fered securities which
desires

sell

the

of¬

before

address

continuing professional

All

too

often,

have little

men

the

Fourth

Annual

Mutual

man¬

they

sales¬

however,

training in
and merits of

the nature, purpose
the funds

trying to sell.

are

They cannot, therefore, select in¬
vestments best suited to the needs

their

ment

customers

the

made

even

Bank

and

(Editorial)-

Insurance

Cinerama, Inc.

Cover

Stocks

Business

Man's

Canadian

Bookshelf

Pan American

Both

attempt.

invest¬

companies and their under¬
an

that the

engaged to sell their

men

obligation to

Securities

Southwest Natural Gas

thoroughly qualified to
perform the services that they are
supposed to perform.. Selling se¬
curities obviously is quite differ¬
ent from selling tangibles which
the

buyer

for

can

himself.

examine

With

buyer must rely
and

the

and

test

securities

upon

principle

same

its

task

From Washington Ahead

the

holds true

It should bring

necessary

Recommendations

Mutual

•

.___

of the News—Carlisle Bargeron____

Indications of Current Business Activity

Funds

Singer, Bean
& MACKIE, Inc.

17
39
34

HA 2-0270

NSTA Notes

News About Banks and Bankers

Observations—A.
Our

Reporter's

Exchange PL, N. Y. 5

Teletype NY 1-1825 & NY

Our

Reporter

Prospective
Public

May

5
45

Governments.

Security

Utility

Railroad

Wilfred

Offerings

Securities

Salesman's

Securities Now

knowl-

L A. DARLING

Securities
Corner

COMPANY

Registration

41
Has

The Security I Like Best

The State of Trade and Industry
Tomorrow's Markets

(Walter Whyte Says)

just announced

and

building interiors.

Continued

page

store

The

PREFERRED STOCKS

COMMERCIAL

FINANCIAL

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

Spencer Trask & Co.
Members New York Stock Exchange

Park

DANA

Place,

REctor
HERBERT D.
WILLIAM

display fixtures, plastic prod¬

present

•

Boston

•

Chicago

volume

SEIBERT,

•

Glens Falls

Sept.

18,

•

Schenectady

•

Worcester

Every

CROWELL, WEEDON & CO.

issue)

vertising
<

city

news,

Offices:

Chicago 3, 111.

—

President

1952
news

and

high

iron cast¬

sales

1953.

Financial

second-class matter Febru¬

grey

new

and

Information

Market

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

Subscriptions in United States, U. S.
Possessions, Territories and Members of
Pan-American Union, $45.00 per year; in
Dominion
of
Canada,
$48.00
per
year.
Other Countries, $52.00
per year.

ad¬

Monday (com¬
market quotation

news,

for

indicates

Request.

Subscription Rates

every

issue

corporation

and

Other

(general

and

statistical

records,
state

LOS ANGELES, CALIFORNIA

Thursday

ings

1879.

TELETYPE N. Y. 1-5

•

plete

Private Wire to

SEIBERT, Editor & Publisher
DANA

Eng¬

25,

York,
7,

ST., NEW YORK 4, N. Y.

TELEPHONE HAnover 2-4300

ary

2-9570 to 9576

Thursday,
Albany

COMPANY, Publishers
York

C.,

CHRONICLE

New

and

Reg. U. S. Patent Office
WILLIAM

BROAD

This busi¬

added

Fund

Reentered

new

ness

ucts, precision and

specialized iri

"VISUSELL"

"ARCHIFLEX"—complete

development in prefabricated store

Washington and You

Published Twice Weekly

have

1-1826

Report

lacking in either
of these qualities, he has no busi¬
ness
trying to sell mutual funds.
The

Dealer-Broker Investment

the

the ability

integrity of the salesman.
salesman

Coming Events in Investment Field

see

are

Conference, New York City, Sept. 17, 1952.

For many years we

Sulphur

they

writers have

will
Cook

As We See It

needs

the

dealer

Commissioner

because

Regular Features

Development

Research Corp.

agement of his funds.

for management.
*,An

his

circumstances, and, thereafter,

they have been obliged to turn to
for the selection of

suitable

and

services

and

others

important

are offering the investor are
the careful selection of the type of

Today, many investors find it
impossible, as a practical matter,
to

most

they

appeared

cause

investment

idea.

company

the

Chicagc

•

Los Angeles

(Boxed)

Hidden

Direct Wires
5
14

Beverage Industry!

Teletype NY 1-3370

their

comments seem
sharp it is not because I have any

Reilly & Co.

Turner Says Industrial Expansion Has Passed Its
Peak, and Discusses Status of Defense Expenditures

We at the Commission earnestly

■><■

•

*Prospectus On Request

Canada's New Horizons:

»•"

•

Robert C.

attention.

Practices

fund operation which now deserve

Meeting the Threat of Creeping Scarcities—William S. Paley_
/

STREET, NEW YORK

Telephone: WHitehall 4-65S1

■

Investment Company Business

Now

they have assets of over
$3,600,000,000!
Today I propose to discuss some
of
the developments during the
intervening period in the sales
literature of mutual funds, as well
as certain other aspects of mutual

rates

And

ought—Sold—Quoted

WALL

Objectives in State Securities Act Legislation—Charles S. Vrtis 15

customer for the

same

reduced

would
was

Statement of

circumscribe

contemporaneous

sole purpose of keeping each indi¬
vidual sale below
the point at

the

Some

industry

almost

sales to the

$2,158,000,000.

Clohosey

Patton
a

have followed the practice of di¬

sets

the

in which salesmen of mutual funds

total

the

example,

the

had

,v.

investment

funds

mutual

that

the

and

violating his fiduresponsibility to his custo¬

ciary

se¬

purpose

company

companies

___

Surplus Countries Must Cooperate!—Sir Arthur Salter

true

the sale of

The IBA Model Blue Sky Laws—Gordon L. Calvert

suited to the investor's needs and

CORPORATION

Investment Status of Bank Stocks—F. W. Elliott Farr

point where he sells
something that is not

sup¬

erature

Linen

—Charles

terests to the
an

plemental

We Have

self-in¬

own

tent

investor

Significant Gains to the Nation Resulting From the Steel Strike

pushes his

aeaier

OIL

City Bonds—Their Investment Merits

Meetings Draw Attention to Duplication of International Programs—A. Wilfred May

When

form and con¬
of

—John

,r —T. F.

the

particular investor's needs.
a

the

ther

Gold and General Economic Trends—B. Barret Griffith

misleading material.

NORANDA

Cover
;_r

Taxation in the Future—Addison B.

Two years ago

Mexico

now

ure

The; B & O Earnings Improve as the "Owe" Gets Smaller
- —Ira U. Cobleigh

^
f'

flagrant misstatements of past, but all bad practices
been eliminated, and sales literature too
frequently

.have not

'•

New York

accuracy

Gilpatric

Mutual Funds and the SEC—Donald C. Cook

AND COMPANY

Cover

The Aircraft Industry Today—Roswell L.

advertising, but rather to elevate it

Page

"Trade, Not Aid?"—Melchior Palyi

izations. Refers to the SEC "Statement of Policy" regarding
sales literature, and says its purpose was not to stifle
legitimate
and effectiveness.

llCHMTEIl

B. S.

C. COOK*

Chairman, Securities and Exchange Commission

bank clearings,

etc.).,

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

Other

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

Note—On

account of

the

fluctuations

Members:

Midwest Stock Exchange
Detroit Stock Exchange

Publications

thejate of exchange,

Moreland & Co.

1051

Penobscot Building

DETROIT 26, MICH.

remittances for for¬

eign subscriptions and advertisements must
made in New York funds.

Branch

Office—Bay City, Mich.

The Commercial and Financial Chronicle

(1012)

ore

The B&0

export

ization

the increasing efficiency, and decreasing

debt, of the B & 0; together with thumb nail notes about

its wide assortment of securities.

period

low

interest

rates,

about

talks

one

started

is treated

as a

ally, in the
B

creased

business with horse-

thing apart. Actu¬

same

ten-year period,

equipment
by

Fortunately,

almost
this

I.O.U.'s
$64

was

in¬

million.

during

that

shade less than 2%, $1,245,-

Their Investment Merits

the

By JOHN S. LINEN*

Vice-President, Chase National Bank, New York City

diesel-

life

Bond expert

savers

railway earning power. Well,
& O dieselization, while impres¬

that,

of leading New York bank reviews and analyzes
City finances. Discusses investment position of the

New York

City

sive is by no means complete. The
next step in operating efficiency
after

City Bonds—

can

and terminal
improvement. Freight cars don't
drawn carriages. Two years later 531 to be exact, was all the an¬
earn
dough squatting on sidings
along its early American tracks, nual coupon money required for
for hours at a time.
To prevent
there puffed
this diesel and hopper debit.
that sort of thing, a $2,500,000
and
cindered
Even allowing for all the equip¬
streamlining of the B 8c O Cincin¬
the first suc¬
ment increase, net debt reduction nati
yard was made a while back;
cessful
loco¬
in the decade was $94,918,000; and
more recently a $2,000,000 classi¬
motive, on
in per annum interest, $5,750,000.
fication yard at East St. Louis was
this side of the
That's quite a chunk of financial
completed; in Chicago the new
Atlantic.
The
osmosis; and it's not finished yet. Barr Yard now handles 4,000 cars
lo como tive
For example, the general sinking
a
day. Quite new automatic car
was called the
fund was $1,740,757, and surplus retarders are
paying 20% a year
Tom Thumb;
income sinking fund, $5,943,252, on their
cost, in lowered operating
and the rail¬
in 1951; and most B & O liens still
expense.
road was, and
sell at good discounts—an attrac¬
In general terms, the manageis, known as
tive factor in any retirement pro¬
ment has seemed to be shooting
the Baltimore
gram.
for three altogether worthy goals:
& Ohio.
Enough about finance for the (1) an
Mere
age
operating ratio below 80%;
nonce.
What about the road and it
was 81.2% in 1951; (2) a trans¬
Ira U. Cobleigh
among rail¬
its traffic?
Well, B & O has a portation ratio of
roads has by
40%; for 1951 it
solid geographical grid over, I be¬
was a fraction below that, for the
no means been tantamount to sus¬
lieve, 12 states, serving the heart¬ first time, postwar; and (3) a re¬
tained success, however, and some
land of industrial America from
duction of annual contingent and
of our most venerated and re¬
tidewater at New York and Bal¬
fixed charges to $20 million; it
spected carrier enterprises of totimore in the east, to Chicago and
was $25.5 million in 1951.
da/ have undergone in drearier
St. Louis in the west; including
days, receiverships and diverse
Comparisons are usually lugged
the lake ports of Buffalo, Cleve¬
into an article like this, so let's
types of corporate surgery. The
land, Lorain and Detroit, and such
>B & O never was actually finan¬
be fashionable.
In operating ra¬
other industrial beehives as Pitts¬
cially derailed, but it had a "near
tios, B & O outpoints Penn by
Wheeling, Youngstown,
miss" back in 1938 with maturities burgh,
five percentage points, and N. Y.
Akron, and Indianapolis. A 6,200coming not "too little and too
Central by six; also, it has much
mile
system,
hitting virtually
late," but too big and too early!
less
losing passenger traffic to
every city of consequence in man¬
contend
Having cleared up that balance
with, and much lower
sheet hot box, however, B & O ufacture, ore or steel in the area.
port costs in New York, which it
Bituminous coal is the biggest
went on to a plan in 1944 which
enters at Staten Island on its own
smoothed the security structure, item and, with expanding steel account,
and
at
Jersey
City
power
plants dotting its
and set the stage for upgrading and
through Reading
(42% owned)
the quality of its outstanding se¬ tracks, and an infinite coal supply and its controlled
affiliate, Central
virtually below and around same, Railroad of N. J.
curities.
The 1944 plan consolidated the coal traffic earnings should con¬
Now what's in B & O for the
indebtedness to R.F.C. with long- tinue to gain. In 1951 B & O car¬
investor? Well, he can buy Bal¬
ried a huge 58-million-ton total
term (1965) collateral bonds, made
timore & Ohio Railroad 1st mtg.
about 40% of bond interest con¬ of coal, receiving 40% of freight
5's'of 1975 at 98V2 for a yield of
gross from this source. The rela¬
tingent, extended certain maturi¬
5.12%; or he can step down a
ty j; and, most important of all, tively new Gauley coal field in
notch and buy Southwestern Di¬
built in some really rugged sink¬ northern West Virginia, alone pro¬
vision
5's due five years later
ing funds. Even when your busi¬ vided 3.7 million tons in 1951.
(1980) at 81 to yield 6.34%; he can
ness is just breaking even, if you
No run-down on B & O would
choose from any of four series of
can
retire $1,000
units of debt be complete without discussing
refunding & general bonds (pay¬
(and the interest requirements ore. At Baltimore, the latest thing
ing out from 1995 to 2000) and
that go with them) for $700 apiece, in ore piers was completed, to the
rack up a 6.75% yield.
Then, a
you're bound to progress — and tune of 5,000,000 dollars, on May
little lower on the financial totem
that virtually is what B & O
.7, 1951, to handle the whopping
pole, he can latch on to the income
been doing. In addition, B & O volume of ore, now Pittsburgh
41/2,s maturing 58 years from now,
lines have operated profitably,
i and Youngstown b o u n d, from and at 66
get a 6.90% yield (as¬
In the ten-year period ended South America and Africa. Only
suming interest continuity).
If
Dec. 31, 1951, outstanding B & O 576,000 tons were actually trans¬
he's preferred stock minded, the
bond indebtedness was whittled ferred to cars from 72 ships last
B & O $4 entry has paid just that
down by an astounding $158,800,- year, but the pier is equipped to
in 1950 and 1951, but it's not cu¬
000, resulting in a $7,000,000 re¬ handle 30,000 tons in 24 hours.
mulative, and sells at 44. And
duction in the annual interest bite. This figure is a somewhat remote
finally, if he's the patient type
There's a slight catch to this, how¬ target, since right now, most ves¬
willing to wait for debt reduction,
ever, as in the best traditions of sels toting, the- ore are
general
coal, ore, and general prosperity
railroad finance, equipment debt cargo craft, awkward to unload
road

New York

give quite a
fillip to B & O earnings.

"Expanding Your Income"

1828 the first American rail¬

Maximization of this

load.

bound

two-way traffic

Everybody

can

Curtis Bay Coal pier, right next
door; and then the cars trundled
over to the ore pier for a west¬

By IRA U. COBLEIGH

Some impressions on

coal

dumped from hopper cars at the

Earnings Improve
As the "Owe" gets Smaller
Author of

deal,

Thursday, September 18,1952

,..

bonds and

City's debt is not excessive in relation to
Lists among investment factors:
(1) moder-

says

taxable
ate

percentage

(2)

yard

resources.

of City's budget required for debt
service;
tax limits on providing debt service; (3)
City's budget

has been

than balanced in

last five years; and
(4) a
large amount of bonds are held in City's Sinking Funds. Praises
study of City's Management Survey now being made.
more

It may appear

take the time of
York

bankers

New

York

large

tell

them

that

tricts,

and

proportions
other

duties it is my
business
to

i t i

time

few

observations

subject of interest.

This is pertinent to our

subject

for in considering the investment

merits

York

New

City bonds
must certainly have regard
its resources, taxable assets

for

and its varied sources of revenue.

services

The

the

and

that

required

are

ability of its citizens to

provide for the costs, are both
important factors as we seek to
analyze the city's economy and
credit

status.

The

budget

expense

for

the

1951-1952 of $1,300,000,000,
was
40% larger than the New
York State budget; five times that
year

London

Paris.

and

eight times

London

;

that

and- Paris

of the services are supplied

many

by the national government that
York

New

provides for its

City

citizens, but this gives emphasis
to the greater complexities that
are

involved in the administration

and

operations in New York City.

As is true of many

where

expansive

facilities

;

taxes,

operating

all interest

dividends,
but

compare

year was

embraced

200

over

$96,500,hospital

buildings*

comparisons
New York

doctors.

service,

the

Department of Health, had a
budget of $17,000,000 and about
5,000 employees.
I will mention only one
more,
the Department of Sanitation. The

annual

budget is about $58 mil¬

The department is responsi¬
ble for 5,750 miles of streets, col¬
lion.

lects 5,000 truck loads of

garbage
daily, has the largest

rubbish

fleet

local

services—62

trucks

the

trucks totaling

world

for

different types
over

2,000.

might cite similarly impres¬
sive figures regarding the Board
of Education, the Police and Fire
Departments and other branches
of the city's services, but those
given will, I am sure, suffice to
convince even the skeptical that
size

the

volving

New York City, in¬
it does the service re¬

of
as

sponsibilities
of

its

assumes,

one

vexing arid difficult prob¬

lems.

What relation has this

question

of size to the investment merit of

the City's bonds?

Well,

some

rather

ures

must be prepared for

shockingly large fig¬

connection

with

the

fi¬

expenses,

and preferred

City

the total expense budget.
cago,

was

after

about $6.55

$6,000,000

this

In Chi¬

Philadelphia, Los Angeles,

share;

capital

and

figure

dwindled

sinking

*An

address

Investment

funds,

New: York

by Mr. Linen before the

Seminar sponsored by
the
Bankers Association in

State

cooperation

about $1.40.

with

New

York

University

considering the in¬
position of New York
City bonds we probably should
not longer delay an examination
of the City's bonded debt position.
As

Smith-Douglass Company,

There

are

Incorporated

several factors

Continued

1952.

3Vs% Notes, due September 1,1967

stock cap;

reduction leave little in the kitty
for dividends

though

j ESTABLISHED 18941

but such heavy annual

STATE AND MUNICIPAL BONDS

CORPORATE BONDS

the common; al¬

token payment of 250 or

LOCAL STOCKS

500 this year is not inconceivable,

If, however,

you want to

projectj

the possible growth of this
equity:
a

F. Eberstadt

Co. Inc.

f.
*
-

,
n

Robinson-Humphrey Company,Inc.

few years hence, you may en- ■

vision

some

long-range logic for

speculative entry, at current lev-*
Vi

The

els;

around!

P $>getting

time.

21.

'The '

!<jowe"

.smaller .all the

RHODES-HAVERTY BLDG.
WALNUT 0316

ATLANTA 1, GEORGIA
LONG DISTANCE 421

msty

page

of course, a feather in the common

drains on earned income for debt

tion, New York City, Sept. 12,

are

vestment

Graduate School of Business' Administra¬

Every retired B & O bond is,

and

employees, including
12,000 nursing staff and 2,027 full

with

find

any

The

about 30,000

Linen

aspects of its services
and operations to believe you also
this

This

properties,
John

im¬

many

will

City last

000.

the relative size of New York City
and

the

cities.

The operating budget of the Department of Hospitals in New

suffi-

pressed

and

York

this, I have

been

true

illustrate.

and

ciently

large

required are a bit stag¬
gering. Just a brief reference will

municipali¬
ties.
I n spite
of

sep¬

services

our

states

than

our

ramifications

character

keep informed
on
the credit
many

have

and taxing

and

other

p 0 s

districts

incurring

Thus, both the expense budget
capital budget of New York
City take on substantially larger

among

debt

power.

York

banker

which

arate

unusually

city.

New

City

and

unique

Well,

presumptuous to etc., such costs are carried by in¬
a group of New
dependently operating school dis¬

nancial undertakings of the City.
figures with either foreign Already we have noted the im¬
or United States cities, there are
pressive proportions of the City's
to do a little pitching for him, and
because they were not designed
many differences that should be expense budget.
We will wish
as ore carriers.
coal and steel strikes to vanish, he noted. In New York City there later
Specially built ore
briefly to review the rev¬
are no overlapping units of gov¬
boats will, no doubt, come along can
enue
sources
which provide the
buy sdme of the highly-lev¬
in due course, improving handling
ernment, other than the state,
eraged 2,562,953 common shares, that issue debt or render adminis¬ necessary funds and the reliance
velocity at the pier.
that can be placed in such rev¬
which have gone 21 years without trative services. The educational
enues.
There's quite a gimmick in this
vouchsafing a dividend. In 1951, costs in New York City, for in¬
New York City Debt
stance, represent about 20% of
net,
minus

These Hotes have been placed
privately by the undersigned,

September 15,1952.

Volume 176

Number 5152

The Commercial and Financial
Chronicle

(10131

Mexico

Steel Production

'-/'r The

To Duplication of Int'l

Carloadings
'

Retail Trade

Commodity Price Index
'

and

Food Price Index

■

For the

first time
a

months, automotive production
It

year ago.

was

Ration in. in- policies in

clared

labor

surplus area,

now

faces

rfa™e institu"

4% above the comparable
week in 1951, tout fell 12% below the previous week
because of
the holiday observance. Detroit which six months
ago was derose

the

•

Wilfred

nneifinn

ftS

bodies.

or more—NPA

Fund

in favor of

Auto

producers

and

Bank

eate'capitei^

staff

than

directors

and

tions

tional

million.

Fund's gross expenses during the
Anril 30 laTt

^ /// e,/ing
^nuon wHh

some

«.i

alternate
governors, 14
tive
directors and

execu-

•

Commission for Europe ^
also

their

embody

such

research

tiv^ firct
f]

<f I

Qtpn

contribu-;

toward

oleanins

inwlinf financial

inv

sprawlmg financial

.y'

merger

most construe-

...

„

Advisory Commission.

proper-

also

there

are,

course.

con-

Says Industrial
Expansion Has

tinuing studies conducted bv its
Department of Economic Affairs,
-

•

Additional Lending Institutions

Passed Its Peak
New

—

Imminent Kindred Confabs

Bank-Fund

constitute

overlap- i

14=/alternate'"" Although it would operate with-directors, similarly uses out
government-guaranty,
the
:
; a staff in excess of 400, /
*
: ——
proposed *. new International Fi-;

suppliers, along with oil country.
the pressure the current
week/
according to "The Iron Age.'; The car people are interested
chiefly
in deliveries
during the next 60 days.
Having set booming pro¬
duction rates for
themselves, they are allowing cost considerations/
to go out the
window,/ Only desperate measures are keeping auto
production at a'high rate, concludes this trade
authority. - /.
/ Automotive output soared to its
highest point ihl952 at 103,054
cars and 25,454 trucks last
week, just six weeks after falling to its

in-

deficit

//limn

result,

executive

aross

$3.8 million and

come of

former organization). And within
the
UN
administration

Interna-

51-governors

i,,r

annual bud-

The

Bank, with

the world's
enlighten-1
A*s.° helpful in holding aid m(as in the former's currently stitutions within bounds could be
issued 86-page. 40-table, 4-chart! an even more actlve^riestraimng
quarterly "Economic Bulletin for? hand by the four top-level fiscal
Europe" issued in Geneva by the f ofBcmls comprising the National

alternate directors,

It operates under

author-

88 billion

excws

fnJLSlJ

ment

400
individuals, 54- goverb?rs anc*" a^ernate governors, 15

their

account for much

these present-day
The Fund is now

^iPPed with

get

consumers,

consumers, this trade

typifies the large-scale

^organizations.

Present 30-day inventory limits are
arousing criticism in some
quarters. /The chances are that
inventory limits will be raised to
the pre-strike level of 45
days before too long. It is believed that
a good many consumers
had more than
45-day inventories before
the steel strike.
/ ■/'
;
r

long-suffering civilian

ind

.Slze

TV-

iori

l*ha fact «iat
J,atter> as « / S the 'specific financial
»a^nn
people,, on savings, and the improvement in
&
information to the effici~n'cy that would immediately

e/
onniio^

!llynS
in iht

Kthwould
tn©ir functioning, the United Nstions

^dimensions of

will be under pressure to revise the
defense take

ity notes.

well

objectives does the GATT
organ!-

ping in

;

F'nnH

May

^jesen

and

;

period of time—say for two months

In research

toward each other and Economic
reiaUonship
with
other and OEC

their,

over

1™/1S?/1v IfUrt nlf+o

business total which must be
related to the world's export
business totaling $480 billion., The

William S.

palev
raiey.
V

world.

Bank
M

Actually the amounts of steel which mills are ordered to set
aside for military use are not
being fully subscribed by military
fabricators and, states this trade
paper, it is no wonder set-asides
at some mills are not
being taken up to the limit.
If this continues

xirir*

lSDDina^in" tivities. a^° dFplicate. Fund ac"
in- tfvi/i/s
This, js true irrespective

If the automobile
industry is any criterion of civilian manufacturing, this trade weekly adds, there will be more steel, notless, in the first quarter of 1953. Detroit is planning a
bumper
crop of cars during that period.

£r

/ lapping

•

YnvpS?^t'o°llCy

skm's

BPnmg
sprung

1950, and the

that

Reports that the first quarter of 1953 steel quotas for civilian s
manufacturers will be only 60% of the third
quarter (1952) allot¬
ments should be taken with a grain of
salt, says "The Iron;Age,"
national metal working weekly, this week.
National Production/
Authority itself cautions that this is a tentative quota, subject to
upward revision if supplies become more plentiful.
Most people v
in industry are sure this will be the case.

throughout

have
..nave

and semi-skilled workers.

labor shortage of unskilled

s*affs s?a^inC the
—
■" 5 b0I?e
that the business done by
-

above the level of

elimination of duplicate activities

Daniel W.

■

101.5%

not,

consolidation

instituted.; In addition to the
administrative* streamlining and

most

•

/'///

steel production the
past week moved forward
of capacity, the first week output attained
100% of
capacity or greater since the steel strike.
* :

Mr.

•

future

least

International Monetary Fund
the International Bank could

and

Tw/txr

of the

Programs

WILFRED MAY

foreseeable

meanwhile

Bell, acting under
important outgrowth of the an appointment as
Acting Chair-r
54-nation convocation of the twin man
of ; the
Public
Advisory
Bretton Woods organizations here
Board for Mutual
Security, folis the oppor- lows the
similar Truman-spontunity to focus gored major study and
findings.
-attention :.o n by General
Draper, Mr.- Gordon
the vast dup- Gray's
study of foreign economic

The nation's

wTTtirwfrk

MEXICO CITY—To this writer

Business Failures

,
Aggregate industrial production the past week held
unchanged from the previous week, but indications were that
output would ?
continue to climb toward last year's
very high level;'

;

Auto Production

Industry

J
\

Meetings Draw Attention

Electric Output

State of Trade

ably

nance

Corporation,

' promul- -

Presidential
—

fies statement

adviser

/
quali-.

defense outlays

„

•

participated

by:

govern-

Also

new

postwar low due to the recent steel strike.
'/.'; "Ward's Automotive Reports" said it

the

industry and banking rep-/vesting

seminated

5 man's

low.

♦

Since about;last
Aug.

18 they have been
trying to recover
by extra shifts and overtime. /'
;
/
r :/..'
?
"Overtime and/Saturday production at

lost ground
/'

;
,

hours at General -Motors continue to

ation," Said "Ward's."/:V
Second shifts

capital/In

explored

again there under /^ie aegis of
Chrysler and: extra" ■the Technical
Coopcratlon Adminhighlight the industry'S oper-'
istration of the State

•>;/ '//'//•/

the

itself

create

'issued

.Sep t:

capital/

the

';?f olio wiing

view of the tapering-off of;
U. S. non-military aid, Europeans',
mobilization, of their own capital
.

assumes

additional

•

also being lined, up. at Nash
and

are

ehlargdment of /private
investment' are to be

assist-

in eco¬
nomic affairs,

; ..ant

♦

not

Mr. Tru-

man,.

mobilize the European capital
that is already there, and that the
initiation
of
a
new
institution

does

office

John R. Steel-

effort that is taking to

was the industry's bestf
: Plate in this field of international
production week.-since the,, one ended
Sept. 22, 1951//Rocking/
/economic activity. The Objectives
under the blow of the recent steel
strike, the car companies had
of expanding Point IV
assembled only 18,760 autos six;weeks
and the
ago for a post-World War ll
^

/in.

intra-European in-'
institution
resting :on
resentatives, called by the Inter- equity ;
investment,/ has/, beennational .Development
'Advisory talked about here—in the face of
Board, seems to typify the dis-! the fact that the real
problem is
ment,

grea t

f; honor

and.. a

Department,/In any event, attainment of curCommerce/ as/rency convertibility is far more

Department of
as the above-named

; ; \
consider

importance.;

statement:

Jt /a

/fine

oppor-

Studebaker/
,/"|ii ii ity / to
IDAB.. important; -than the
continued
plus overtime and six-day operations at
serve
as ;a
Ford, said the Agency. / }/
///The imminent British Common- spawning of aid-institutions.
Robert C. Tufner
But the "success or failure'/ of
member of
planned record turn-outs. dur- :
wealth..Conference; in its -facing• n„ni, rimii'
ing the rest of this year may depend on the
the Council Of
rnneAiMaHan
availability of-workers. * of; t hq problem ' of/,
commodity?
w
a
' Economic c Advisers/
"Ward's" believes that thousands of
The-''perioc
Detroit and othef area: prices and", sterling crisis
repreWhether an over-all* worldwide? ahead will challenge the economic
auto
workers—many now /idled by model changeovers^-will be
sents
-another/meeting, which in reorganizatlon /of
internationel forecasters'' skill 'to the utmost
out of jobs no longer; than, 10
tliis instance will share
days to two weeks1 in September
■t, 'f
the Fund's economic agencies- is t™ -irtonwn/ r ,"f I r?ilf
;;

well

—

•

and October. / Before the steel

unemployment

strike, five to six

in prospect.

was

;

weeks of such

objectives ! in a major
world. / .. /'

Credit controls,over residential and
commercial construction/
were
suspended-by the Federal Reserve Board on
not

The order

Tuesday of this
applies,only to conventional mortgages and does

real estate credit insured or
guaranteed by * Federal
Conventional mortgages account for
70% of the mar-"
ket, officials stated. //
/
.
"
/
The suspension means that
as far as the
government is con¬
cerned, home buyers will no longer have to
putMown a certain
portion of the price of a house in cash and
pay off the balance in a
cover

agencies.

page

;
;

Fund

the
a

record

smaller

far

toward

EPU

affiliated,

the

We take

activities
vast

pleasure in announcing
the ekction oh

in its

comprising,

world's

'.''J-

•'

{■

•

"/'•'.

.
•

wishes to

announce

m*i

and

also' has,'

galore. r

research,

projects

that from this

date it will be known

with

there

..."

and

their

Fund

and

...

likewise

occurring in

rious

individual,

have!

;

../

projects

COMPANY INC.

Manaeirp.
.

■

Fundamental Investors, Inc.

Investors Management Fund, Inc/-

Parker

Westminster

va¬

of,,

;

which

promulgated.;- The/
these,, the embryonic,
special -.investigation of - U.
S.
trade policies, to be undertaken^-,
.

with the

;///{•''/ /'[/

been*

latest
September 15, 1952

President

INVESTORS MANAGEMENT

Duplication of investigatory ef¬

Hemphill, Noyes C8b Co.

Bank

our

•/"'

•/•'. •■'

Surely v the

staffs,

the

Commerce, and the Export-.
Import Bank, etc., etc.
fort

been

and

/;/' ''

i/t/

research

own/government de-partments, as the Treasury, State,'

,,j

com¬

partially overlap those of
United Nations' organizations and

r*1

W. Emlen Roosevelt

at least

•

has

Galore

investigation

duplication

Hemphill, Noyes, Graham, Parsons C&, Co.

than has the Fund.
Research

•'

/■-/. /-■::

freeing trade and!

countries,,,

two-thirds. of

page

effective

;

i.'

considerable over¬
lapping of those two bodies. In-,
turned

•

;

reveals

cidentally,

Continued

r.-yi..
;•./

Payments Union and the
optimum future objectives of - the
ropean

merce,

;

reason^

establishing fiscal soundness

Continued

to ^ in the cards for the

Current discussion here in Mex¬
ico of the activities of
the Eu¬

...

week..

sector -of

the

blessing of the Fund—by

elizabeth,"new*jersey

•

Commercial and Financial Chronicle

The

Thursday, September 18,1952

...

(1014)

Taxation in the Future
CLOHOSEY*

By ADDISON B.

Washington Tax Bureau
Institute of America, Inc.

Director,

have

high level until 1955. Holds
higher in event of all-out war. Points out,
however, there will be changes in tax laws, but leading to no
general reduction in the "tax take," and enumerates some
specific tax problems facing Congress. Advises business firms
draw into this year all expenses they possibly can, and defer
until next year all income possible.
remaining at present

What's

continue

are

that

have

complete

an¬

also
been disciples of a balanced budg¬
et.
It will be impossible for a

answer
because
we
/-icidisun

whether

know

armed

state of

peace

that

defense

war,

the

state

House "

whether

the

Congress

will remain Democratic or change
to

Republican.
We do know that Federal taxes

than they are
likely to be again unless we have
higher

are

now

all-out

another

fiscal

war.

the fiscal year just ended
last June 30, the American peo¬
1952,

ple paid $14 billion more in taxes
we paid in fiscal 1951, which
the

the

people

than

York

plicitly, the actions of the Senate

That

bench

the

same

Senator

entire

from

mark

discuss the

proceed to

ifs, buts and perhapses of taxation
the

When

future.

the future, we mean
able future,

which

the foresee¬

shall limit
That in it¬

to the next five years.

self is

limitation because

brave

say

session
it is frequently difficult to pre¬
dict what it may do in the next
five days. Five years of Congres¬
sional activity will fill a lot of

when

the

and

the

effect

can

vital

very

not

incidence

taxation

only

but

changes might be, it is necessary
assume

increase in the

allthat

cessity for preparedness—no
out

war.

the

light

ne¬

assumption then, we can proceed
into an analysis of the situation
that
will be the basis for«the
informed guesses
.

that will follow.

One of the features that affects

the

trend

taxation

tional budget.

There

the

seems

na¬

to be

little

hope for any real reduction
in the amount of Federal spending
before
the
end
of
1954.
The
"stretch out" of military contracts
and the delay caused
strike

have

into

1954

the peak

ing

that

*An

by the steel
to extend

combined

least

the

latter

part

in military spend¬
were

supposed

by Mr. Clohosey before
the Printing Industry of America Con¬
ference, New York City, Sept. 8, 1952.
address

the

ought

how

and

people

the

consideration

the

determined

the

amount

excise tax rates will be re¬

some

enact

If extreme emer¬

tax.

at about that time.

The

duce

that

the
It

not

the

light of these

let

therefore,

ations,

how

determine

might

look

the

consider¬
us
try to

tax

the

over

picture

five

shorter holding

period are

and

Means

Senate

the

and

Committees.

nance

•

Fi¬

1955

In the first

and I

think

reasonably substantial reduction
doubt
before

that

will

take

There

1955.

will

taxes

ef¬

taxation,

some

cuss

take

years may

necessary

the

to dis¬
notable

tapering off of the extremely problems even though my conclu¬
high rates, possibly by the be-' sion may be that there will be

some

ginning of 1954, but
that

fore

substantial

call

be¬

1955.

can

The

now

could

taxed in

normal

and

surtax

the

the other.

Tax

Act

the

action

-V<

relation

:};

drastic

most

and

occur

one

change

fhat

for which

would be the much discussed and

one

tax ■highly publicized proposed Con¬
The Excess Profits stitutional amendment to limit in¬
excess

1950

profits

carries

termi¬

come

estate

and

(»axes

machinery

and

replacement.
that

ference, how

all

comes

anyway.

feel

dif¬
depreciate — it
even
in the end,

you

out

voices

The

many,

added

taxpayers are being

many

change, and
could be effected within the

those

Many of the valua¬

experts in the Bureau
it doesn't make much

tion

one

seeking

five years.

•

(2) Section 117-J is the one-way
street for taxpayers — That is the

trend

There

now

consisting
staff

sub-committee

members

the

Joint

from

the

Committee

railroads, have

lot of such sales,

capital gains against which
to offset the losses. I imagine the

but

same

is true

of printers.

At any

knowledge of this
inequity that caused the Congress
sel's Office, the Chief Counsel's
to
reject the proposal in 1950.
Office
and
the
Commissioner's
But it did get through the House
Staff, trying to work out some
before being killed in the Senate.
effective way to tax such benefits.
So if they come back with a pro¬
However, it isn't politically feas¬
posal to say that all such sales
ible and it isn't practical, so I feel
produce either ordinary gain or
that fringe benefits are destined
ordinary loss, such proposal may
to be bracketed with double taxa¬
get through.
!

search and Tax Legislative Coun¬

rate, it was the

tion of dividends and cooperatives
as

tax

about

problems frequently talked
not acted upon during

but

the next five years.
It

won't

surprise

25%.

(3) Accelerated

Amortization

—

present provision for accele¬
rated amortization of defense fa¬
cilities will probably not be in
too much 'existence after the middle of 1954.
The

during this five year period we
Y« get a radical change in the field

great many taxpayers have hoped,

ways—through the combined

hand
on

are

them.
■

Corporations
two

little

reduction

the

VJ.

effect
some
very
drastic changes and
in estimating what you may have
to look forward to in the field of

in the next five

place, there will be

reduction in taxes

that

trend

The

Treasury

the

the
Repub¬ Taxation, the Treasury's Tax Re¬

lican members of the House Ways

Substantial Reduction
Before

the pro¬

most

use

them.

Republican Con¬

Some Notable Problems

have

because

gress,

years.

basis for determining de¬

equipment, or the modern age in
which improvements come so fast
that obsolescence requires early

the

ponents of the lower rate and

gressional action.
In

unless

Bureau

Bureau's Bulletin

that is worrying both
section that permits the sale of
and the Congress
real property or personal property
toward more fringe
used in a trade or business, and
benefits in the settling of labor
if a gain results it is a capital
contracts.
These fringe benefits
gain; if a loss, it is an ordinary
consist in pension plans, health,
loss. In the Revenue Act of 1950,
welfare and sickness benefits, rec¬
the Treasury tried to get Con¬
reational facilities, etc. They are
gress to change this provision. But
given to employees in lieu of
they attacked it the wrong way.
monetary
increases,
are
neces¬
They tried to have either gain or
sarily something of value to the
loss
treated
as
capital gain or
employees, and the Treasury and
loss.
But capital losses are de¬
the Congress are therefore trying
ductible only from capital gain,
to find some way in which to tax
and a lot of companies, notably
the

moot question and
likely to be de¬
next five years

within

cided

transactions.

is, however,
one

through

revenue

medium

rated

recent years

capital

preciation rates is out of date. It
fails to take into account accele¬

One of the economic changes of

•

brought to bear by some
groups affected by Con-"

pressure

fect

In order to evaluate what these

that

strongly they make it felt. Every
tax bill is political and frequently
the actions of the Congress are

but

itself.

into

take

feature

taxation

mood

number of

changes,

the tax system

Millikin
final

Chair.
trend

of the "Congressional Rec¬

pages

ord"

Congress

whether Senator George

the

country in 1941.
which

will be about

Finance Committee

State

the

from

whether

To state it more ex¬

committees.

the total

taxes from

New

collected

gency

gains tax rate is
something that the Congress has
discussed at great length for the
last two or three years and will
continue discussing for the next
four or five years.
There are a
lot of reasonably wise tax leaders
in the Congress who feel that a
lower
capital gains rate and ,a
shorter holding period will pro¬

the
World
Incidentally, in fiscal 1952
more

sales

eral

year.

duced

in fiscal 1941,

than 50%

other

Republicans or the Southern
be the chair¬
men of the various Congressional

the Federal Government collected
more

pressures

higher rates at least for an¬

the

tax

the

experts

that the

agree

printing.
However,
period of reducing

action in the
They include:

(1) Depreciation—Even the val¬
uation

exclude serv¬

the Congress will not

situa¬

into

develop

will at this time withstand.
and will continue anything in the nature of a gen¬

gress

such

the

fiye years.

I feel that in a

the

last full fiscal year prior to
War II.

such

ices

Such

general trends, but there
will be some specific items coming
before the Congress that might

would need a

level.

retail

the

would probably not

taxes

sake

reduce

they existed prior to the Revenue
Act of 1951.
I feel that the Con¬

the size of

the

for

also

but

by the board
the rates as

let these increases go

Items Coming

about'adds

That
tion

percentage through income
They would double the
from
excise taxes and in

order to do this we

Democrats happen to

previous all-time
much

collected

taxes

mendous

collections
doubt that they

to continue to be so ruled

high. This $14 billion increase was
almost twice

just

take

■

considerably

"employer" will be

Before Congress

1954, and the
general sales tax at a fairly high
will be subjected to tre¬
rate at either the manufacturer
pressures
not only to

Congress

tax

taxes.

and

taxes

Some Specific

all-out war should re¬
reducing taxes.
quire the need for more revenue,
The above predictions relate to
Whether or not the Congress
under the theory that income tax¬
the particular taxes involved for
changes from Democratic to Re¬
ation
has
already
closely
ap¬
a two year period.
If we do not
publican doesn't seem to make
proached the area of diminishing
too much difference in the overall get into an all-out war, I predict
returns the Congress would have
trend because the Congress has that the excess profits tax will to turn to a general sales tax for
be a thing of the past by the mid¬
been ruled for many years by a
the additional revenue needed.
coalition of Republicans and dle of 1955 and that corporation
and individual income rates and
"Fringe Benefits" Problems
Southern Democrats and is likely

than

established

deficit

the

Republican
Democrat will be in the White

don't know whether

level

lower

cally on March 31,

the

down

even

and there is sopie
will want to increase

in now.

are

budget

present

the kind of hybrid
or preparadness for

peace,

Act of

couple of years for them to reduce

definition

changed from one hiring eight or
more
employees to one hiring
one or more employees.

excise

and
imposed by the Revenue
1951 will expire automati¬

pay¬

probable also that if the
security
system
is
con¬

will be implemented by

cigarettes

automobiles,

liquor

the other hand, they have

plete

excess

excise taxes

The increases in the
on

Ke-

rue

House,

publicans have endeavored to sell
themselves as the party of lower
taxes in the last few years, but

any com¬

will be in

White

the

Joint Commit¬

proposals
rate then political considerations from big business that a considerwould require at least a token ably higher percentage of the to¬
decrease in the individual rates. tal revenues be collected through

difference

much

too

the

the time

tinued, coverage will continue to
be broadened and probably the

tuting

social

the feasibility of insti¬
general sales tax. This
study will not be released until
after
the
election. Its findings

study

they have

they become disabled to be
able at the age of 65.

Taxation has completed a

not

ing of their benefits at

any

Committee given dur¬

of Congress'

staff
tee

1953.

reduction

enact

the

profits tax not compensated for by
an increase in the corporation tax

whether Eisenhower or Stevenson

informed

don't

makes

guessing. It is
impossible to
give

normally
taxation is

not

of whether

reached the age of 65, or a freez¬

their executive deliberations
Revenue Act of 1951, the

ing

My guess
the Congress will continue
but if there is any sub¬

them,

permanently disabled regard¬

less

general sales tax or manu¬
facturer's excise tax.
In accord¬
ance with a mandate of the Sen¬

the Revenue
scheduled to ex¬

are

whether

in¬

income tax

Dec. 31,

is that

identity of the Administration,
Republican or Dem¬
ocratic. At this time I don't think

possible to do
some

pire

whether it be

swer,

1951

Act

the

seems

one

trend

the

affects

The

pro¬

sort of

enacted

stantial

day and while
to

second feature that

the

chances.

its

between

to somewhere

individual

The

Important

every

rity system.

adverse publicity

The

15%. Or, (2) will
excess
profits tax die,

creases

are

men

asking

national pension

system in lieu of the social secu¬

the measure.

excess

ate Finance

Administration Change Now Not

questions

be in favor of

to pursue

10ne of the big problems that is
affecting the Congress at this time

1955.

into

determined

the loss in revenue.

picture is likely

budget

high

Stevenson?

What

write to the Congress about it to

the result

let
the
but
compensate for its demise by add¬
ing the necessary number of per¬
centage points to the corporation
surplus tax rate to make up for

middle

the

and

12%

Therefore, the extremely

of 1953.

What does Ike think

taxes?

These

they

about

achieved

have

Can

Will

higher?

be reduced?
about

taxes?

for

ahead
any

the

18%

■from

taxes may even go

they

still

ar¬

very least change that we
profits tax
posal has been getting in recent may expect in social security
at least for another full year but
months,1 that is tabbing it the during the next couple of years
possibly at a reduced rate of 20%
"millionaire's amendment,v seems will be either the outright grant¬
rather than the present 30%, and
to have been extremely harmful ing of benefits to persons who
would probably reduce the ceiling
are

Democratic

taxes

sees

Continue

early reduction in taxes, regardless of whether
or Republican Congress, Mr. Clohosey

are

ticulate enough on the subject to

net of only 17 states seem

that

is that the Congress
one
of two things. (1)

that jority of taxpayers who

indicates

since withdrawn

resolutions, with

their

guess

will

The Research

Predicting

12 of the 29 have

corporation tax in¬
creases were permitted automati¬
cally to expire.
the

and

tax

analysis

Treasury

profits

in fiscal 1954 if the excess

social

know

it,

security.

but

viduals

when

the

generally compute their profits on
a
quarterly basis, so would like
to have the March 15, June 15 and

1950

Act

6000.
Security
of 1950 and which constituted

the

most

which

session

the

Social

was

Filing Tax Returns — Indi¬
in business and partners

not

Senate Finance Committee was

executive

(4)

You may

far-reaching

change

Sept. 15 dates for filing
returns each moved up
to

estimated
a

month

April 15, July 15, and Oct. 15.
request seems reasonable, and

The

social security since its original
this
enactment, the Committee almost may be granted/
Federal
threw
out the
entire bill and
(5) Withholding on Dividends
1953 unless the Congress acts to tax system within the next five
asked for a complete elimination and Interest — The Treasury will
extend it. The corporation normal years because the Congress has
still be looking for legisiacion to
of the social security system, to
tax increase of 5 percentage points never indicated any favorable in¬
be replaced by a system of na¬
permit withholding on dividends
added by the Revenue Act of 1951
terest in it.
Its proponents have
The last time they
tional old age benefits supported and interest.
expires automatically on March been trying for more than 12
from the general tax funds.
tried it, the Congress refused on
>
31, 1954 unless the Congress does years to have enough states pass
The
correspondence that the two grounds: (a) It would require
something to extend it. My guess resolutions to require a Consti¬
more
reports and more record¬
is that the Congress will do some¬ tutional Convention, but 32 states Ways and Means Committee and
Senate
Finance
Committee keeping for the corporations pay¬
thing about corporation taxes in would have to adopt such resolu¬ the
ing the dividends and interest,
1953
because
it would cost ap¬
tions.
Proponents
say
that 29 are receiving in respect of social
and
(b) it would deprive some
proximately $4 billion in revenue states have already done so but a security today shows the vast ma¬
nation date which

provides that it
on June 30,

However,
will

expires automatically

■

become

don't

feel

part of

that

our

Volume 176

Number 5152

The Commercial and Financial Chronicle

(1015)

non-profit organizations (hospi¬
tals, etc.), that are not liable for
tax

dividends, of their income
for the greater part of a year until
they could get a refund.
The Treasury has worked out
an
answer
to
these difficulties,
and

on the next try
provision through.
1

affected

are

by the Internal Revenue

Bureau

frequently than they are by
the Congress, and there are three

in which recent Bureau

areas

tion

should

tention

portend
at

be called

because

all

future.

The

first

to your at¬

three

these

the

family partnerships. The fam¬
ily partnership as a tax-saving
has

vigorous

been

the

cause

disagreement

between

the Bureau and the taxpayers for

Then came the splitprovision which elimi¬
nated the necessity for forming
partnerships
between
husbands

many years.

income

•

(2)

can; at
next

Observe

tax-planning

the

time

the

necessity

for

transaction

ac¬

into

constitutes

tax-saving opportunity, Study the
tax

advantages

rates
tween

disadvantages

tremely

The

children

and

profitable,

hassel again

and

to settle

favor of the

ex¬

the

old

Act

(3) Remember that Congress is
political body. It is more likely
reduce

taxes

alleviate

months

rely

to
maintain
con¬
particular tax problem if expenditures
tinued growth and stability. This
you ask it.
Unlikely to do any¬
will require economic statesman¬
thing about it if you don't.
Mine has been the easy task— ship of the highest order. It is for
establish

mains

for

operate

the

climate.

the

you,

re¬

experts,

that

-reason

rare

challenge and opportunity to

.serve

it.

that

one

consider

the

President's

advisers."

Mr.

Most

economists

admit that

they

forecast, but if
be

;

are

can.

not

pressions, * defense

efforts

have

policy

pect for the next, year or so, but

•

value
■

are

the

■

immediately ahead the beginning
of another period when our abil¬

tested.

Recent

time

tures

when

month has

defense

rising

were

come

"Moreover,

the

expendi¬
month after

ex¬

program, stimulated
in
substantial measure by the mobil¬
ization

of presently planned de¬ peak.-".
"Two
production programs indi¬

has

program,

/v:
powerful

passed

its

Turner
statement

stimuli

in¬

that

they

other

the

that

Administration

such

officials.

acknowledgment

repercussions,

the

newest

member of the President's Coun¬
cil of Economic Advisers
is

his

reported

we are
going to inch up."
Budget Bureau figures, released
subsequently
to
Mr.
Turner's
original statement, showed that

defense

outlays in July were at
$12 V4 billion a quarter,

have

original statement.

Sept.

qualified
While

re¬

strike

rate

the outlay
military dollars have "virtually
their peak" was sharply
challenged by the Pentagon and

Possibly

say¬

just

estimated

under

rate

billion

budget

amplified
"On

figures,

his

the

Mr.

Turner

statement,

saying:

average,

this fiscal year will
contrast with the

the

income

who

producing

{This announcement is neither

rapid month-to-

the

last

two

years.

year we

capital is a bona fide partner re¬
gardless of where he sot the capi¬
tal, and regardless of whether or

defense

expenditures."

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

not he renders services.

$139,647,200

However, the Bureau put out' a
10-page mimeograph a couple of
months ago,
the situation

purporting to clarify

Standard Oil Company

with regard to fam¬
ily partnerships formed since the

Culbertson
It

does

Case, and before 1951.

that

beautifully,

much

goes

farther.

completely

the

determination
the

form

the

(an Indiana

Thirty Year 3Vs% Debentures

the

"intent

partnership,"

Dated October 1, 1952

the

"what

the

Convertible

Culbertson

Case, to
ownership."
Under this mimeograph it be¬
comes
virtually impossible to form
a

unless

"the

donee

and

exercises

control

do¬

his

over

or
/

her interest."
deemed

not

Minor children

control

their

property, and if control
cised

19S2

prior to October 1,1962

Rights, evidenced by subscription warrants, to subscribe for these Debentures have been issued
I by the Company to its capital stockholders, which rights will expire at 2:30 P.M. Central Stand¬
ard Time on October 6, 1952, as more fully set forth in the Prospectus. The Company is also
receiving subscriptions from certain of its officers and employees during the subscription

partnership with a minor
child. The partnership is not valid
minion

on or

true

valid

the

Due October 1,
it

established by the Supreme

Court

corporation)

changes

validity

from

valid

but

emphasis
of

partnership

norm

period for not in excess of $4,000,000 aggregate principal amount of Debentures not purchased
:
1
by warrant holders, as more fully set forth in the Prospectus.

are
own

exer¬

trustee in their behalf,

trustee

must

judicial supervision.

subiect

Subscription Price 100%

The trustee's

responsibility under State law is
not

sufficient, there must be

tual

The
of

second

head

During and after the expiration of the subscription period, the several underwriters

married

the

for

should

include

shelter,
sumed

Bureau

may

these Debentures in

Zenz

food

legally offer

con¬

decision
The

the

MORGAN STANLEY &

CO.

THE FIRST BOSTON CORPORATION

KUHN, LOEB & :CO.

Bureau

complete about-face

regulations and taxed
a

as may

recent

resulted

Court.

be obtained from only such of the undersigned

compliance with the securities laws of the respective States.

and

expenses

its

on
a

dividend,

even

GLORE, FORGAN & CO.

BLYTH & CO., INC.

SMITH, BARNEY & CO.

HARRIMAN RIPLEY &

GOLDMAN, SACHS & CO.

stock

though

all of the stock of the
taxpayer was redeemed. The District Court upheld the action of
the

■r

distinguished

only

activity

redemption

Copies of the Pros pectus

household

expenses,

feature

District

own

the premises.

final

unfavorable
Ohio

Bureau

that

utilities 'and

The

did

The

dependency

should

tures

living
him, and

v/ith

decide

expenses

from

following prices (i) the highest price at which the Debentures are being offered in the over(it) the greater of the last sale or current offering price of the Deben¬
the New York Stock Exchange, plus in either case accrued interest and an amount
equal to any dealer's concession.

the-counter market, or

un¬

than 50% of the house¬

expenses.

about

of the

par¬

maintains

offer

dependents

household

pays more

hold

who

person

household

may

Debentures at prices which will not be below the Subscription Price set forth above (less, in
the case of sales to dealers, the concession allowed to dealers) and not more than the greater

the participation
household in the

split-income provisions. Such
ticipation is limited to an

ac¬

supervision.

CO.

Incorporated

DREXEL & CO.

LEHMAN BROTHERS
'

EASTMAN, DILLON & CO.

KIDDER, PEABODY & CO.

Bureau, but probably will be

reversed

Appeals.
Bureau

the Circuit Court of

Even then, however, the
will persist in its new¬

found idea, and its action porten-'s
considerable
litigation
in
this
field

the foreseeable 'utu^e.

We have established
—now

what

you

the trends
do

higher,

SALOMON BROS. & HUTZLER

UNION SECURITIES CORPORATION
September 18, 1952.

Ui.a

may

STONE & WEBSTER SECURITIES CORPORATION

WHITE, WELD & CO.

about

theui?

(1) In that taxes won't

MERRILL LYNCH, PIERCE, FENNER & BEANE

LAZARD FRERES & CO.

lower,

any
even

►

will be

entering the so-called 'plateau* in

offer to sell

The

contributes

month increase which has charac¬

taxpayer. It provides

anyone

rise

be small, m

partnerships in which

capital

Simultaneously with release of
the

terized

Press, said that the

$14

quarter.

During this fiscal

Turner, according to

July, and by that time will
at

the Associated

billion

quarter for the entire year ending

iterating his view that the period

rapidly rising defense spending

average

$13

the argument in

factor,

"vir¬

ing that the "rapid growth in de¬
fense spending is over; from now

will

reached

is .over, Mr.

remarks

end.

industrial

pansion

Studies
•

expenditures

must forecast, as best
,

will

that, contrary to general im¬

attempting to

"We will witness in the months

power

cate

virtually reached their peak.
No significant decline is in pros¬

our

real

any

making,

above

Expansion Ended?

phrase

the rate of

Turner Amends Statement

Has Industrial

original

tually reached their peak, was 'too
Increasingly, in the strong'; I should have said 'close
ahead, we will need to to the peak' or
'approaching the
a rising level of consumer
peak.' " He is also quoted as

of their force.

1951

that in all

trans¬ flation and high-level business ac¬
tivity have therefore lost a part

Continued from page 5

fense

to life.

came

Revenue

seemed

the

economic

But

parents

complete

you

your

year-round

enter

you

same

all

can.

Every

which

the

year

that you

that

continually rising ity to maintain maximum produc¬
made such partnerships be¬ tion, employment, and purchasing

and wives.

(

until

income

etc.,

area

device

possibly

defer

before
action.

actions

•

you

maintenance*,

draw

ac¬

litigation or
least uncertainty for the fore¬

seeable

repairs,

expenses,

area

year,
you
ought
this year all the

tivity.

taxation

Trends in

get the

may

into

The Commercial

(1016)

and Financial Chronicle... Thursday, September 18,1952

Light—Review—Ira Haupt & Co., Ill
Also available is a memoran¬
Maine Power and Public Service of New

Pugct Sound Power &

Broadway, New York 6, N. Y.
dum

Dealer-Broker Investment
Recommendations & Literature
understood that the firms mentioned will he

Weir & Company,

Young,
ronto

Debenture

Convertible

Canadian

Issues

—

Continued

York

annual meeting and dinner at
Whyte's Restaurant.

ers

Co., 25

Broad

Express

—

Bank

memoranda

Memorandum

Heller

—

Rauscher, Pierce & Co.,
Also available are

Tex.

Cameras, Inc.

Analysis

—

Shader-Winckler Company,
Richard¬

Sons, 173 Portage Avenue, East Winnipeg, Man., Can¬
Bank Building, Toronto, Ont., Canada.

Electric

Gas

work and

Company—Analysis—G. A. Saxton &

Foods, Inc.—Analysis—Cruttenden

Co.,

Harold B. Smith

New

NSTA

New
L.

York

120

—

Data

—

Oct. 5-7, 1952

Association
Firms

Board

Stock

Fall

Hopkins

Mark

the

Exchange

Governors

(Los Angeles,

Calif.)
Association
Firms

Exchange

Stock

Fall

Governors

Board

Security Traders
meeting at the Ambassador HoteL

of the

(Miami, Fla.)

Oct. 20-23, 1952

Moreland & Co., Penobscot

National Security
ciation

El Paso Electric Power

Company—Analysis—Ira Haupt & Co.,
Broadway, New York 6, N. Y.

Convention

Traders Asso¬
at the

Roney

Plaza Hotel.
Oct. 24-27,

Falconbridge Nickel Mines Limited—Analysis—Aetna Securi¬
ties

the

(San Francisco.

Oct. 8-10, 1952

Building, Detroit 26, Mich.

Ill

Hotel.

Broadway, New York 5, N. Y.

Association has presented the following slate for officers
Association for 1953:

Broadway,

Golf Day

Dinner

Calif.)

SMITH, Chairman
Advertising Committee

The Nominating Committee of the National

Co.,

treat

Steak

County Country Club, West

Orange, N. J.

NATIONAL SECURITY TRADERS ASSOCIATION

5, N. Y.

Darling Company

(New Jersey)

Dutch

Beef

and

Essex

Pershing & Co.

York—Analysis—A. C. Allyn &

Company—Analysis—Reynolds

ber-guest

HAROLD B.

Co., 44 Wall Street, New York 5, N. Y.
Cross

Association

Bankers

Bond Club of New Jersey mem¬

meeting

Co., 209 South

Organization, 100 Broadway, New York 5, N. Y.
of

Oct. 2, 1952

list of the various affiliates with
their results to date. We hope this will please
the membership.

Chicago 4, 111.

Edison

Country

Convention.

Annual

Compo Shoe Machinary Corporation—Analysis—de Witt Conk-

Consolidated

See

City, N. J.)

complete

Chicago Daily News—Card memorandum—Swift, Henke &
135 South La Salle Street, Chicago 3, 111.

Salle Street,

American

hope others may follow suit.
Within the next few weeks we will publish

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

Clinton

pleased to mention our

Johnson, Lane, Space & Co., Inc., Atlanta,
has been working on some commercial
advertising, as well as Clyde Ulmer, Courts
& Co., Birmingham, who seems to be follow¬
ing our suggestions in securing other than
broker-dealer
ads.
Many thanks for your

ada and Royal

Central

are

"fling-ding"

Tee

Sept. 28-Oct. 1, 1952 (Atlantic

who

Building, Detroit 26, Mich.

Columbia Packers, Limited—Analysis—James

week

Nah

Statler, and Time, Inc.
Penobscot

Club.

President, Frank Burkholder of Equi¬
table
Securities Corporation, Nashville, for
confirming the largest ad received this week.
Also we would like to mention Lex Jolley

Bradstreet, Gerber Products, Hotels

the Mah

the next 30-45 days.

This

annual

sociation

former

Building, Dallas,

Dun

Rockford Securities Dealers As¬

pleased to advise our membership we are over

Co.,
Also available is an anal¬

Inc.—Bulletin—Stanley

Street, New York 5, N. Y.

Mercantile

an¬

the Huntingdon
Club, Abington,

Sept. 26, 1952 (Rockford, I1L)

most

$16,500 in gross advertising. We should better last year's record
so would appreciate it if our various chairman and members make
further efforts to increase this gross within

♦

are

ysis of Laclede Gas Company.
American

Philadelphia

nual field day at

AD LIBBING

Voorhis

Industry—Analysis—Kalb,
Street, New York 4, N. Y.

Industries,

& Co., Ill Broadway, New

Rubber

(Philadelphia, Pa.)

Club

Bond

Valley Country
Pennsylvania.

6, N. Y.

90 Pine

Sept. 26, 1952

Notes

NSTA

Street, New York 4, N. Y.

Aluminum

(New York City)

Association of Customers' Brok¬

—

Mutual Funds—Booklet—Ira Haupt

lin

annual field day at the Knollwood
Country Club.

Sept. 24, 1952

Fifty—Analysis

Broad

son

page

Booklet—McLeod,

by dollar value of 50 listed stocks
popular with professional management—Laidlaw & Co.,

British

Municipal Bond Club of Chicago

Ltd., 50 King Street, West, To¬

Exchange Place, New York 5, N
Favorite

Argus

(Chicago, 111.)

Sept. 19, 1952

Commerce Building,

Field

Investment

Limited—Memorandum—T. H. Jones & Co., Union
Cleveland 14, Ohio.

Rainbow Oil

pleased

Suggested portfolio for appreciation
risk—Oppenheimer, Vanden Broeck & Co., 40

Appreciation

without undue

most

EVENTS

available is

1, Ont., Canada.

Capital

Co., 120 Broadway, New York 5, N. Y. Also
review of Washington Water Power Company.

the following literature:

send interested parties

COMING

Company—Review—Sutro Bros.

Light

Puget Sound Power &
&

Central

Hampshire.

1952 (Havana, Cuba)

National

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

Traders As¬

Security

sociation Convention tour.
General Public
New

Service—Circular—Hardy & Co., 30 Broad St.,
4, N. Y.

York

Hoffman
Boston

Oct.
;

Radio—Circular—Raymond & Co.. 148 State Street,
9, Mass. Also available is a memorandum on Textiles,

Inc.

Company—Details—Kippen & Co., Inc., 607 St.
James Street, West, Montreal, Que., Canada.
Phillip

Harry L. Arnold

James

Clark

Investment Bankers Association

wood B6ach Hotel.

—

Lower Tampa Bay Bridge 3%% bonds (Bulletin No.
& Co., Inc., 40 Wall Street, New York
bulletin

(No. 58)

-•

New York Central

Railroad—Memorandum—Herzfeld

30 Broad Street, New York

•

4, N. Y.1

•

I
"

Railway Company—Analvsis—Faroll & Co.,
209 South La Salle Street, Chicago, 111. Also available is an
analysis of Tri-Continental Corp.
;

Pickering

Lumber

6,'Mo.

Harry

Denver.

;

.
.

'■

Second

'■ V

Goldman,

Sachs
-

■>' 5:.

•

Vice-President:
-

Treasurer:; Lex

;

& Co., New
"
]

Mazzaferro

James B.

Jolley,

^ :/..

■

California

Johnson,

Lane,

Space

(Speeial to The Financial Chronicle)

& Co., Inc.,

SPRINGFIELD, Mass.—Donn C.
Tryson

Members: N.

Security Dealers Association

Trinity Place, New York 6, N. Y.

Fenner

Curtis,

Beane, New York City; George J. Muller, Janney &t
Do., Philadelphia; and Hugh R. Schlicting, Wm. P. Harper & Son
&

Co., Seattle.

become
associated
Webber, Jackson &

National

Third

Building.

San

has

with^ Paine,

Troster, Singer & Co.

—

with

With Paine, Webber Co.

Stifel, Nicolaus 8c Company, In¬
:

Francisco, Chairman; John, L.
Canavan, Rauscher, Pierce & Co., Dallas; George J. Elder, Straus, <
Blosser & McDowell, Detroit; Elmer W. Hammell, Shillinglaw,
Bolger & Co., Chicago; John M. Mayer, Merrill Lynch, Pierce, / /
Company,

Anna TL
Townsend,

Mass.

Boston Stock Exchanges.

Maguire, J* B. Maguire< &

\ Members of the Nominating Committee were: John F. Egan,

First

Dabney & Tyson, 30 State Street,
of the New York: and

;

members

•

New Circular Available

: -

Townsend Dabney Adds
B O S T O N,

)

Slay ton &

with

previously

; '

Atlanta.v
\
•* :j
'7 Messrs Clark, Bupn and Jolley have been renominated for
the positions they have been holding in 1952.
* \ j,
••

Southeastern Public Service

was

••

■*

John W< Bunn,

corporated, St. Louis.

v/rV—•'

•

Vice-President: Phillip J, Clark, Amos C. Sudler & Co.,
/

Secretary:

7% Income

Jollej

Co., Boston.,,.;;
•

Arnold,

City.

First
•

•;

;

Partners are Ed-

(Special to The Financtal Chronicle)

President:

Baum
-

Lex

John W. Bunn

York

Corporation—Analysis—George K.

•

& Co., 1016 Baltimore Avenue, Kansas City

•

Bank Building.

'•/;:/VCo.;

Nuclear Instrument & Chemical Corp. — Circular —
Republic
Investment Company, Inc., 231 South La Salle
Street, Chicago

4, 111,

Hess Invest-

l'¥;!;V^.ward C. ahd'E. M. Hess/ Mr. Hess

;

Norfolk & Western

»'

;

i'V^Vv^meriifCo^' has been formed with
J;- / "Offices |n the Illinois National

& Stern,

»''

~y.*r'P (Special to The Financial Chronicle) 1

f'ifcfw^QUm

Homes

Corporation—Analysis—Kiser, Cohn & Shumaker, Inc., Circle Tower, Indianapolis 4, Ind.

;

i Vt- './•

Maine Turnpike.
-

National

Co. Formed

8)—Tripp
5, N. Y. Also available

Holly¬

Annual Convention at the

& Manufacturing Co. — Card memorandum
Baker, Simonds & Co., Buhl Building, Detroit 26, Mich.

5,1952

(Hollywood, Fla.)

Maguire

61 Broadway, New York 6, N. Y.

Lemaire Tool
J

;

Nov. 30-Dec.

Chemical Corp.—1952 annual report
—International Minerals & Chemical Corp., 20 North Wacker
or

Meeting

Homestead.,

International Minerals &

Drive, Chicago 6, 111.

of Southeastern
Group of the Investment Bankers
Association of America
at The
Fall

Hudson's Bay

1952-Nov. 2, 1952

31,

«(Hot Springs, Va.)

■,

Joins Vance,

Continued

page

Bank

...

Sanders

-I

•_

(Special to The Financial Chronicle)

BOSTON,- Mass.

—

Arthur

Long has become connected with
Vance^ Sanders &

■;

Devonshire Street.

Company, 111

Volume 176

Number 5152

The Commercial and Financial Chronicle

(1017)

of the second

Gold and General Economic Trends

"you

doctor

sound

are

walked

out

used

say

dollar"

his

wise to invest in

now

office

feeling

uals

Taxes seem to
ceiling. Individ-

restive

are

under

their

tax

fine and fit to fight wildcats. To-

burden.

day such

re¬

further levies placed on

our

Uncle Sam's total take might not
be
expected
to
increase
very

mark

doctor

would

scare

death.

This

describes

which
look

;

we*

dollar

statistics. New

••

the four balls—taxes, income,
prices, gold stock, he will probably lose control of the fifth ball

loans ^

consumer,

com¬

B. Barret Griffith

banks,

a "*< .zfvtg

com-

banks for the policy of
buying government bonds at peg-

frightened to see the continuing world and domestic mess
after having lost part of his savings through dollar depreciation,
We

recognizing

are

bad

invest-

tion.

frightened

are

our

expensive ride from crisis to crisis
as

passengers

the

automobile

ODtimist^6 /eason'inT of^nme d4vefn by JUt£ry P°1UicaI haP"
reasoning of
pointees who have
been
optimistic

the

is confused

aaassats aactfir

substituting loans to

mercial

who

and I,

you

and

point

some

these

factors,

and

increasing

debt of corporations to meet bulging
inflationary
cost of taxes and
payrolls. Years
ago

and

mortar

taught that brick
investments eventu-

had

ally

were

earnings.
the

paid

net

confused

are

otimistic

out

reference

in-

creased

plant I. expenditures
by
corporations when the amount of

being put into brick

money

mortar and
ceed

fixed

corporate

assets

and

may

ex-

net

earning projections.
And
finally when we
hear that business,
profits, commodity prices, and the stock mar-

ket are sure to be
good for months
.ahead because of the defense pro-

gram, we have the
that one feels when

^dl, 0

same
one

reaction

looks into

n^. mlrror in a fun house

at the carnival.

Is Defense

Are

will

preparations
or

losing

and

any

the West-

confidence

politicians?

it any wonder that they

are

rec-

ognizing the mistake which they
when, by giving
up the right of converting currency into gold,
they, in effect,
traded their gold for paper money

made 20 years ago

and thus allowed
to write checks

factors

their bank

ac-

the

economy

may

0£ ajj the goods and services produced in this country are not pro-

ductive.

Non-productive

services

seem

goods

breed

And soft money

money.

non-defense

trade

..dependsentirely

exists

the

upon

1 ultimate
consumer, and at no time
can he be
forgotten. By the

duction of

upswing in stock prices
generally since the middle of 1949

inefficient,
reasons

total

seems

leave

with

you

this

political

statements.
Nothing is
certainly something may
be gained by comparing current
political statements in terms of

balance

lost and

gold. Gold is
ject.

and

will

loss

ating statements

or even

reducing

those statements to per share balance
sheets and profit and loss

em-

Payment, high wages, 52 million

statements is not enough. To com¬

frig^Vrs^and televisionTeViii
g

pare

everyone's

results, of

ings,

statements

their
are

home

policies.

true

Those

one

looks only

and

amount

working capital

one

would

buy

for each $100 invested at

rent

•*

necessary to reduce earn¬

assets

the

own

at the

mine with another mine

one

seems

market

prices.

(Special to The Fin.nci.l Chjokicie)

hps

has become associated
™S JL
'
^arew
Mr. Phillips was Pfcv1""

YJ1**1

M v

Executive

Vice-President

Smart, Clowes & Phillips, Inc.
Prlor thereto he was Cincinnati
representative for Hugh W. Long
& Co. *nc*

Edward Naumburg to
Be Stieglitz Partner
Edward

cur¬

Because

way,

that

ultimate.'

is'

consumer

animal whose

■

arbitrary habits of
saving money and spending money not only depend upon his particular

•

economic

position at any
time, but also to considerable degree is influenced by how he feels

about

things.

how

Recent projections

the

ultimate

consumer

should spend his money, save his
money, and act seem to have left
out how he

his

might feel.

What

are

hopes and fears?
first

But

Sam

who

let's

ager
,

Naumburg,

the

Jr.,

Investment

gold

the depressed state of gold mines,
it is important to know the earn-

ment for Stieglitz & Co., 40 Wall

clining value of

The

ings, net assets and working capi-

of the New York Stock Exchange,

state-

tal for each $100 invested at pres-

will

ent stock

in the firm

paper money.

these

answer

political

ments of progress, as suggested by
.,

(<1

during the last 20

bv returning to

ten

years

from

today

admitted
on

Oct.

partnership
1.

while to notice whether increases
or

years

decreases

year

good gold dollar

today."

Also, it is worth-

each

same

between

milled

tons

production
be

per-

(special to the financial chhonicle)

ST. LOUIS, Mo.

Discrepancies Keehner

company.

the

With Fusz-Schmelzle

production from

approximate

should

whether

■

year

changes

centage

by **"°
'
purchasing power has a
chance of being worth the

prices.

Street, New York City, members

checked

ore

Clarence B.

—

now

with

Schmelzle & Co., Boatmen's Bank

see

Building, members of the Midwest

mined

Stock Exchange.

■

This announcement is not an

ojjer ojsecuritiesjorsale

or a

solicitation oj an ojjer to buy securities.

New Issues

September 18, 1952

Columbus and Southern Ohio Electric

Company

Par Value $100 per

300,000 Common Shares
Par Value $5 per

useless,
worthless, and old-fashioned and

Uncle

biggest

the

single

this

consumer

time,
even
though that means he is someof a midget compared to

thing
the

combined

consumption of

individual Americans.

himself

supports

sales,

and

issuancp

sell

the
to

the

bond

to be
bonds

rates
r-

limit

can

appears

the saturation

sales

present

TTT",,
♦A talk

seems

Al-

money.

banks, he

have reached

all

Uncle Sam

taxes, bond
degree by the

number

money

issued

interest
u

point

individuals

tr.u

carried

and

can

Prices:

paper

controlled

those planners who see all and
know all that is good for us common

men.

taxpayers

$100

$24,875

financing because of their
shortages in monetary gold reserves.
Yes, the economic managers point to the $35 per ounce
price for gold, the same price as

had

1934.

share for the Preferred Shares

are

our

per

plus accrued dividends from August 1, 1952

told that Britain and France need

Copies oj the prospectus

per

map

share for the Common Shares

be obtained jrom such oj the undersigned (who
ojjer

arc among

the underwriters named in the prospectus) as may legally
these securities under applicable securities laws.

But

they can
point with pride, nor do
to the fact that they have

they,

iaiied to buy gold to back up the
flood of paper money they have
issued

he
xr

by Mr. Griffith before the New
York Society of Security Analysts, New
York City, Sept. is, 1952.

and

that

peaceful trade
currency

there

under

Financial
contrary

Dillon, Read & Co. Inc.

neither

confidence in
their
manage-

nor

ment.

paper

though there

better

hopus

and

pocus

the

notwithstanding,

Blyth & Co., Inc.
Merrill

men.
It is the money
manager
and paper money he prints which

is suffering depreciation, not gold,
There is a reason for this. After

all,

God

made

gold

before

matter
unt~r.„

fact

God "made

£Old before he made Sex.
is mentioned in the tweltfh

The Ohio Company

Stone & Webster Securities Corporation

Hornblower & Weeks

Lazard Freres & Co.

W. E. Hutton & Co.

Hemphill, Noyes & Co.
Paine, Webber, Jackson & Curtis

made money managers and
paper.

The First Boston Corporation

Lynch, Pierce, Fenner & Beane

gold retains its value in the minds

Gold
verse

Reynolds & Co.

L. F. Rothschild & Co.

Fusz-

tons

and

grade of

that the business of the world

Man¬

Depart-

other Slde of the coin 1S the de"

neither

look

CINCINNATI, Ohio-Howard E.
Tower.

review of balance sheets and oper-

rrescott hi Cincinnati

°^sJ,y

a basis permitting sciencomparison between different gold mining companies. Casual

make

cl,aims about social gains full

and

MllluS Willi

•

funda-

DLHIIha UfUL
r

11"

tific

now a political sub-

made

profit

items to

New Dealers and Fair Deal¬
have

sheet

IIOWaiQ

90,000 Cumulative Preferred Shares, 4.65% Series

As individuals

that

pro-

the company and tons

from

told

are

and

for vari-

dollar

milled by it.

a measure

dollar measures today's value of force of unhappy events brings it
his foreign and domestic policies
about, gold and gold share investWhile on the subject of the ments should still fare relatively
everlasting value of gold and peo- well during that period of adverpie's inherent habit of comparing S1
For splpctinn nf unlH sharps
it
other things to gold, it might be
timely although an admitted di- may be helpful : to apply the
gression to consider some current thought of reducing important

non-productive goods.

price for gold.

and

between

ance

soft

portant
•

wise.

now

The Fixed Price for Gold

and

wars

looking at

preparations for wars, the customer is the government. But im-

gold

The

recognizing any of
our fears,
or the people's confusion, the economic managers point
with pride to the $35 per ounce

periods

and

today's apparent prosperity
be an niusi0n.
Too many

Far

During

gold

other important

is that

illusion?

;

are

invest-

political leaders

Qur conclusion from

these

m^nts

believe

declining, the mill capacity, is

insufficient

for

counts?

for

is it

has been sparked
by oils. If the mental thought. A gold investor
protection fluctuations of the last 19 months does not have
to be a prospector,
against
governments.
Because are to be resolved on the
upside, Stay with the many established
man
accepted God's gift of gold we believe it will be the result of Canadian and
several
American
and
sex
there has always been a return of
confidence through mines. Homestake is an excellent
comparison of other values to the
re-establishment
of
sound American example, and remember
them. It is no wonder then that money which would be bullish for there is still gold in Cripple
people measure our government golds. If, unfortunately, return to Creek,
today by saying "the 50c Truman sound money is delayed until the

and

suffered

are

currencies

Obviously,

in the
given to

crises.

World

was

Wise Investment

gold' 1S let s nai1 down whatever
gains we have enjoyed or losses

that people of

wonder

Gold and Gold Shares Now

when they believe
the top of their

reach

mountain

breed

and

really profitable,

war

able to tell
we

and

Spending Profitable?

wars

never

value

Gold

men.

wealth

ers

On the other hand the ultimate

debt of individuals and large debt
of our government make us un-

the
tne

any one

debt.

Banks

burden., If he drops

invest¬

mercial

real

demand' de->

ments of

appears

and

posits,

Sam

his present debt not to become

icurrenc yjj
turn-over of i"

and

Uncle

gold stock in the air in order for

peaks in total
deposits

them, but

to
be
like a juggler
trying to
keep taxes, commodity prices, national income, and the monetary

the

through

eye

much.

Corporations might have

gold's

and has been used as

gold and gold shares

reached

for

minds of

is willing to pay.
have

out

Adam's rib until ten verses later.

reason

Contending today's apparent prosperity may be an illusion,
Western investment analyst points out government
spending
for goods and services is not
productive and breeds "soft
money" as well as inflation. Calls for restoration of gold

the

Eve

gold's origin told us in the
Bible and history, there is every

B. Barret Griffith & Co., Inc., Colorado Springs, Colo.

standard. Holds it is

chapter of Genesis.
make

From

By B. BARRET GRIFFITH*

When

didn't

God

Shields & Company

Financial Chronicle

The Commercial and
10

.. .

(1018)
Wage Stabilization Board. It the last offer, made shortly after
that
the
new
Board the strike began, been accepted
have power to deal not just with then instead of in late July, the
wages,
but
with non-economic
issues in labor disputes. Non-eco-^

Republic Steel Corporation

reviews developments in steel strike,
and the union had been able to
carry on their negotiations without government interference
much of the $4 billion loss from the shutdown would have
been avoided. Lists as by-products of the strike: (1) awak¬
ening of public to danger of labor monopoly; (2) the judicial
settlement of the right of Executive seizure; (3) a practical
demonstration that present day system of labor negotiations
is futile; (4) public's realization of the dangerous implication
of the union shop, and (5) unmasking of alliance between
Government and organized labor.
Steel company executive

industry was denounced

The

year

I have been

up to my very ears in labor dis¬
cussion, controversy and negotia¬
tions.
During those months we
had an eight-

strike

weeks'

the

one

—

bitter

language

untempered

and

executive

family.

The

industry was seized by the
President of the United States, as
of

shackles

off first by
and

seizure

strikes

of the United

There

was

only

States.

one

labor

the

sult of
of

compa-

nies

wo r

tion

Steel-

America.

T. F. Pacton

e r s

demands

These

fantastic in their scope and

Initially
demands

there

when

were

broad
broken

detail

months

gaining issues, involved more than
100
separate subjects. They in¬
cluded an unspecified but "sub¬

miliar

stantial" wage increase, a guaran¬

working

•

wage,

conditions,

changes

other

and

strike

steel

crippled

our

the

negotiations that fol¬
are
undoubtedly fa¬

You

with

taken
It

demands

either

the

that

steps

were

by the parties concerned.

might

well,

though,

have forgot¬
ten, that the Union had powerful
point out, in

allies

case you

the

run

the

steel

com¬

panies—and the Union Shop.
Six
steel

hundred

workers

give
the

seizure

There

to him,
industry.

the

directly

Vice-President of

time

filled

with

endless

the

United

talking, of course, of Judge
David Pine. He was faced with a
tremendous problem when the

For

j°™Pan!e® ,CJ?"th®.
dent's right to seize the industry ;■
J^e ,c<\u d have temporized and
handed down a decision which

good many years a great

people-and many of them
neither in industry nor business—

many

have

dangers

No
would have criticized him too
vigorously for straddling this hot
^sue. But Judge Jhne evidently
was not that kind of man. To
him there was an important issue
vltal to the entire country, and
°_n® which should be settled once
would have gone part way.

monopolies,

labor

°9e

pointed out that this country

Thev

was'

con¬

lie

the

out

pointed

which

frightening

with

drifting

rapidity into a position where the
power of labor could exceed that
of
government. While we have
heard much about the power of
business, that was a puny power

compared to the power in the and for. all.
futility. We felt hands of the labor unions today.
The decision which he wrote
many
things we were
Not
many
people
took
this was one of the most amazing in
do represented largely a
warning seriously. They thought it °Vr leSal history. Not only did it

deep

feeling of

that

forced to

just another case of business

discuss the implications of seizure

crying "wolf" in an endeavor to
Wage Stabilization Board we had stultify the labor unions. They
grave doubts as to
the judicial were unable to visualize the fan-

an{*. tbe le§al arguments for and
against it completely and thor0UShly, but the decision was so
clearly and simply written that ,lt
could be understood by a high
school pupil.
Pl?e s decision was appealed to the Supreme Court oi
the United States. By a
three decision the Court ruled that
President Truman s seizure of the
steel industry violated the Constitution and infringed on legislative powers reserved to Con-

time

waste

were

attitude

effort.

and

summoned

which

the

When

before

Board

was

the

would

tastic

bring to the hearing.
the

as a

result of a sympa-

and laws writ-

thetic government

which,
incidentally,
beyond anything that the

Board,

went far

which labor had ac-

power

cumulated

The final "recommendations" of

in labor's favor.

ten

Then the steel strike with all of

the Secretary of Labor, Union had hoped for in its most its consequences hit the country
pro-labor Senators and Con¬ optimistic moments, proved con¬ with devastating force. One hungressmen, and
powerful govern¬ clusively that our -doubts were dred fifty million people saw 650
mental agencies such as the Wage correct.
•
thousand workers leave their jobs

Administration met its

conditions. One condition
the

Administration

was

that

reconstitute

In the
out

course

four

the

different

companies
offers.

the nod

cents

watched

nation

with

reports came from all

Had

think the people of

this

coun-

try became more than a little
afraid.
They began to visualize
could

what

if three or
joined together

happen

four union leaders

•

calling strikes.-They began to

'realize that the country could
ruined

(10

They

COMMON STOCK

man.

dent, like Congress, was lirnitea
ih his actions by the Constitution,
parts of the country of shutdowns The decision put a stop to a steadin
plants making needed muni- dy growing access of powers
tions.
-claimed by, or used by, or allowed
The people of the country sud- * by default to the President. Had
denly began to realize that any the Court ruled otherwise, it would
man
who could close, so many have overthrown our entire conplants and throw so many people cePt of government by balanced
into idleness had more power in powers as conceived by the foundhis hands than any one man should
fathers. We would have had
have
a government by men instead of

dismay

Corporation

single

plants

The

halted.

•

Skiatron Electronics and Television

and steel
production come to a sharp halt.
gress.
•
The disastrous results, however,
At one stroke the Court ruled
became apparent only as steel fab- against the Presidential theory of
ricating plants joined the steel "inherent power" and settled this
plants in idleness. The nation saw question once and for„ all».
the production
of civilian goods
The Court ruled that the Presisteel

saw

of the long drawn

negotiations,

made

108,000 Shares

Par Value)

thoroughly and completely ' through the edict " of a

•

handful of labor leaders as it could

•

Price $2.50 per

•-

-came

teoted

■

...... -

.r.

„

Negotiations

•

„

The third point deals with the
difficulties

present-day

labor

a
'\"r
-years, as labor
it was possible
of a company

an<* a, un\on *°
dowm together
and thrash out their differences.

Rarely did either side win all that

Coffin, Betz

123 South Broad Street,
September 16, 1952

Philadelphia 9, Pa.

Action was resumed.
In tbe case of the steel strike

Representatives and Senators won-

the whole Picture was different.

maritv
*

men

P°ther"^UnifynfnJSn, HSS''
Y Vnne

Co.

Member New York Stock Exchange and Philadelphia-Baltimore Stock Exchange1

vote-seeking politician

tmi.NnHi

toey

could do

fleeting the letters

Thev were

from their constituents.

pie

realized

that- the

From the very outset it seemed as

rt though negotiations

andy telegrams

The peo-

monopoly

was

tweed the

■:

^
f! i ^ wanted but through collective
,.}abor Lii? Jfer J? bargaining, through concessions
against the deals maLV" made and accepted,-an agreement
reached.
The strike ended,
f

be obtained from the" titidersigned

Difficulties Present Day Labor

think the people be-frightened
*

•

may

law.

It has taken a long time to settie this legal question but that,
too, is now behind us as a result
of- the steel strike.
;

armed

F repeat; T

Copies of the Offering Circular

by process of

invasion.? They were negotiation. . - ,
.•?
worried.
They now know they - For a good many
face a problem. That is an enor- controversiesarose.
mous gainv
•
^
.
for representatives

•by

-•

these

States,

unless the
by Mr. Patton before the
Association, Atlantic
City, N. J., Sept. 11, 1952.
Petroleum

from

the question of seizure.

First-The field of labor mono-

strike.

*An address

National

result

second

briefly.

you

The President made the very same

af¬
We attended session after ses¬
They lost Stabilization Board and the Price
more than $350 million
of
With this sion
in wages. Stabilization Board.
negotiations which
we
iThis is more than they will gain powerful array against it the steel knew would be futile because the
leaders
had
committed
by the wage increase during the industry, big as it is, felt like Union
contract period. The nation, hun¬ David confronting Goliath.
themselves so firmly to their de¬
mands that negotiation was almost
gry for steel for defense and ci¬
The strategy of the costly fight
vilian purposes, was deprived of was
apparently worked out by the hopeless. For a long time it was
close to 20 million tons.
Union long in advance. As early as as though you were in a swamp
and every step you took seemed
;
It has been estimated that 1,500,- February, 1951, the United Labor
carry
you
further into
the
000 other workers were idle for Policy Committee refused to con¬ to
morass
and
further
away
from
Labor's
cooperation with
varying periods as the steel inven¬ tinue
solid ground.
tories of the fabricators melted government
defense committees,
fected

The

rather certain by¬
the strike which I months of labor controversy was
be of lasting value the decision of the Supreme Court

some

fifty thousand
were

The "Seizure"' Decision

and

country.

our

was

These included

its side.

from

would have taken
hands of management

right to

after

the President of the United States,

the

would

President

by error.
Secretary of
Taking it all in all, it was an
said, "No enemy na¬ unhappy and unproductive period

changes which
the

The

strike.

important gain out of this
controversy.

Wage

described

I have no intention of discussing

lowed.

annual

the

have

could

specific collective bar¬

teed

without

wanted

has this work stop¬ ferences, negotiations and meet¬
page.
No form of bombing could ings. Throughout those months,
have taken out of production in those of us who were actively en¬
one day 380 steel plants and kept
gaged in carrying on the industry's
them out nearly two months."
side of the controversies, had a

effect.

were

which,

down into

production

the

United

literally threw away $4
potential wealth and

effects

Defense.

the

steel

were

demands

made

dramatically
Robert
A.
Lovett,

re¬

series

result of this labor contro¬

The

controversy
was

fantastic

the

costly

going to discuss
its immediate

but

results,

had as¬

the strike

not

only one error in this
production, much of which can line of reasoning: Mr. Murray had
never
be regained.
The cost of assumed the President really had
strikes is high these days.
the power to seize the industry.

States.

This

So today

mistake in

Strike

the

By-Products

In retrospect I believe that as a
At this point I should like to
Stabilization Board would
by almost half a billion, than the give it to him. And if the Board's result of the strike we have made pay a tribute to a man who should
total expenditures of the Federal recommendations were not met in gains in five directions, each one and will go down in history as a
Government for the year 1931.
full by the companies, then the of which I want to discuss with man of courage and conviction. I

billion

history of the
United

strike

steel

the

figure of $4 billion. This is greater,

versy

the

ten

Judge Pine and finally

conclusively by the Supreme

Court

i-*—

striken

were

authoritative
source sumed that, with the Administra¬ products, of
placed the total loss resulting from tion's aid, he could get what he believe will

wasteful

most

the

and

remember,

may

you

prevented a settlement for
was won—and I say this
in any spirit of boasting—by

long

away.

and

costliest

it must take away the excess,
I don't think it's going to make
not
much difference what the comthe companies. That was the issue plexion of the next Congress may
of the complete Union Shop.
be., I think the demand for this*
It has been said that there is curbing legislation has been toosome
good in the worst of men great to be ignored^
If we get
and that some good comes out of sound, sensible laws in this vastly
important field, we will have got¬
the most evil situations.

by the President and others in the

the blueprint. Mr. Murray
a

have been

which

ity it wanted.

and asserts that if companies

For almost

strike would

by some six weeks.
So I think we can look forward,
But, as is the case with all curing the next session of Connomic issues of course include the
Union Shop; Labor got from the things, we finally came to the end gress, to some legislation which
will curb the power of labor. This
Administration just what if of the road.
The
Union
gained substantial legislation should not deprive lawanted—just the kind of Board
it wanted with the kind of author¬ economic advantages but the issue bor of any of its just powers but

By T. F. PATTON*
Vice-President and General Counsel,

leaders can only be remedied in
Washington, since it was created
cut short in Wasnington;

demanded

Significant Gains to the Nation
Resulting From the Steel Strike

being exercised by labor

power

the

18,1952-

Thursday, September

doomed.
^
clalmed that th.ey were not g01ng
were

Continued

on page

'■'■x.

Volume 176

Number 5152

The Commercial and Financial Chronicle

(1019)
America.

We Have

Dictatorship of

By CHARLES E. WILSON*

torship of a few politcally powerful men, who are holding the
very destiny of the country in their hands."
Says he was "over¬
steel controversy by

elected

plores

appointed to

control

ar'e

was

exer¬

than the President."

produce $1 billion annually in taxes.
countrv

our

and

bigger

than

businessmen, I think

all

should

and

congratulate the

this

reacn

Sfof
many of

today

oppose

Seek

not

op¬

only

us?

Destroy

all of this

The

answer

simpler than the
people

some

has

government

gradual¬

of
-

in
and

but undermin¬

and

con-

provided

And,

whether

may

down

good

manners

have

not,

say

of?
Charles e. Wilson

For

been

long

time"

time

that

all

business, and all of us who love
country, attack the one big
problem that threatens everything

our

in America believe in.

incredible

that

are
we

always

are

land

their

now

for

gress

seek

business

and

Amer-

few

But

intentions.

danger is that

loss before

ican businessmen and the freedom
and well being

our

defeatism of the

and

years

back with

start

think

for

acquired
that
of

their

the

own

this'

business-

country

when

can

Business

for

long

our

good

has

been
less

ten

answers

inhibited

its

!!?hPy

believe

from

destroy completely
strength and

its

people have

that

the

when

the

battle

should

lost

completely,
you
and
I
be hurt too much.
Suppose

first step in its
program, the
government takes over the raila

living will sufand you will still be
better off than most of the
people
in other parts of the
world.
In
fer

"free

little,

are a dirty name, but
short, you will eat and sleep reathey have become tone-deaf sonably well.
Physically, at least,

that

this

old

expression and
they are bored with it. We have
same

life will still be worth

The

progress

tion,
big

our

government and

little people

meet

your
fancy, is
accelerating, even while the popular cry has begun to go up against
it. I've seen it, and I know it.

That's because the

it:

Many of us unwittingly
along with it in order to get
But

know many
,

when

address

-Week

the

Commerce

by Mr. Wilson

cause
.

Rail-

luncheon
and

sponsored by the
Industry Association of

New York, New York City,
Sept. 16, 1952.

and

the

wants

every

man

and

„"dpr

the

that

business.

and

distribution

to the people?

facilities

Immediately this

wil1 be attacked, I know, by a lot
of those people who will say that
we'
are
thereby trying to give

dangerous

these facilities to Wall

that

7aif flSS
n/nnJ

Street,

.Not at all. The potential buyers
are a11 around us. They are exactly the millions of our fellow

nation

kinH

democracy
American

that belief. And

the

system.

who own gov"
tt

Exchange U, S. Bonds

strength

competitive

ernment bonds.

cither

and

™ey arf

survlve

can

svstem

their system, let

woman

individual

ment>

And to-

~°, it Americans still believe

who loves his country
to learn again that

any

What is wrong with selling our
national darns, generating equip*

Now in business we
iNow, in pusmess, we

submit that

freedom

operator of

we.

teed^m'^haVs/rfdom,4 and" I

not

businessman.

Under this plan, bonds could be
exchanged for shares of stock in
the new companies to

start practicing

we will, as soon

spring from

as tbe People really know what the presently government-owned
Pakes us insist upon it. The cry- plants. It would be
deflationary
mg need for a more effective edu- to the extent that the debt is reeational program to teach those duced. Instead of tax-free
power
who do not kn(nY
thaj the only and water projects, the new corn-

Not

road

too

many

decades

ago,

Personal

prosperity

and

national

freedom

panies would pay taxes

the mating

lived

bonds

proaching soundness.

•

„

Need a Blg btlck
We have to launch a second

concentration

power

government is equally bad.

Plan

era

by
And

is.

Cut

Federal

Debt

business.' Millions

by 10%
Our national

proaching
we

I
*

could

debt

$270
cut

today is apSuppose

annuall
.

llon ln„m r^

would

—

sense

some

would

even

bil.

Perspnal interest in business. They
wouia be^buying economic under'

Continued

though

page

of these Shares having been sold, this announcement appears

NOT A NEW ISSUE

as a matter

of record only.

September 16, 1952

<•
■

100,000 Shares

effective

Telegraph Company

.
#

•

Socialism

Down

Washington

our

socialism at

Common Stock

have

creeping paralysis of
work.

The

($10 Par Value)

develop-

ment of this incredible philosophy
of weakness is almost blueprinted,

step by step.

But as insidious as
it is, the masterminds behind our

headlong plunge into
tent government

scheming

are

an omniponot

Bolshe-

change
our„
just because they want

it that way.
They are,
naive,
fhpir

IP.

that

for the most part,
earnest, and dedicated to

fac;k

their

Thpv

liiey

system

rPnllv

re.aily
IS

hpliPVA

Deiieve

gOOd

for

in-

The Western Union

tjg omly
voluntary participants, ana mat a.
Payments. This all_we askand no longerwould unJben they could the
main purpose of derstand,
half

owners

Busi-

beyond that against hunger, has saving is not the
been against being pauperized and the
proposal at all,

All

own

American

„

cut,

almost
,

terest

10%?

insignificant 27 billions—but if

proprietorship
many who and responsibility
not otherwise
10%—just Possible.
They would acquire a

mere

could make that

part

ness Enterprise — and as
these millions would have

billion.

that by about

minimize

save

tangible

know there will be

will

Man's struggle through the ages,

today. But most important of all,
people would be buying into

the

living, and

to awaken our
people and
halt to this foolish and
easy
acceptance of economic suicide.
•

call

economy

times

•

just the

—

+v.P,r

means

going to go down fighting,

♦An

find

vjks

are

should

the

children will lead, unless

our

feel that if you go down,

you are

road

go
our

•

if it is, I

even

of you

There

done. N

life

machinery has watched

been in motion for 20 years, and
it takes more than talk to change

business

just

But that win not be the
kind of
economy

socialization, nationalizawhatever other name for

happens. to

will all go along.,

you

not translated very well.

toward

lesson, and the teacher should

Rut

method. But they are operating"
under the big government concept,
which has never in history proved
itself an intelligent and efficient

Your level of

ces.

not

enterprise"
to

taught

come

words

mP+hnri

and

much

busi:

mPonf ThL ^ncrht^ Americans we want to reach, the
wl.Amsame Pe<>Ple who need to learn
SpfanH Lt
+hPabout and understand the true

the

won't

been

nevef argued the need

prohibit
against man

and

and going

greatness
10 greatness.

—

some

should

treacherous

basic

enemies.

that millions of

people

man

are

and theyare servins a«
important public need. We have

Abraham Lincoln observed

s,tatesmanhship ~forh prof
time
here when

The
other

izers.

govern-

time has been

long, and roads.
You
railroad
presidents
in such a way, that the people are
probably will still live in your
tired of listening.
And for each same homes.
Most of you will
plea from business there have probably stay in
your same officase

country

only

act

tried

F„™.ba]°
^ y^if

side is different. If the concentration of power by business was bad
for our, country—and it was—then

„

few hitches in government, I think
•I know the real danger as well as
man.

book valued at approximately 10% of our national debt.

mire 0f ciass strife.

thinking.

great

be/ond
have

built

day we are permitting a misguided few to lead us back into

domi-

once

taxpavers

finance

St™ngT They &re SOUnd

and group against group.

who

We have learned the lesson.
know that this
be

recognized and
the turning of

used

office

much

am-

.b(PPg

exer-

power and water projects, and
similar enterprises that we

own

that grew to greatness because

the

sense

undertakings
their choice and control. The pub-

gaining enough ground

fighting

apologies and complaints.
Probably most of you. know
what is happening to us. After a

any

o™

stock?
of
cLtrOlta-

and

stead of being forced

projects?

our

r Our government is embarked
i
; " , ,
"

have been working hard
at it, the fact
stands out like a
SOre thumb that we
have not been

actions instead of with

pleading its

made

we try the-

system'..

of trust-busting, and we need a
goodness.
;
bigger stock than
even
Teddy
We have been
talking about this Roosevelt could swing. The prinfor a long time. And even
if we ciple is the same—but the back-

that those achieve-

own

«orne

'ments have created and protected.
It is indeed high time that we put
end to

cising both choice

never

nnwer

is being used
by bureaucrats

power

big enough in America

without much faith, and
practically no material proto their credit, to smear and the American
system of incento destroy the achievements
tives, risk, competition; profit and

of American

life

holders in the true

approxia
billion yearly.
And if
through a period of trust- very road tbat once before led us they are
economically justifiable
teaching the people not to be great busting to break up the
big mo§reatness.
undertakings in the first place,
and strong/*It has been
fostering nopolies/ We acknowledged then
This teaching job is not easy, this will prove that they
are, or
a
concept of weakness, of depend- that the concentration of
powef but it is far from impossible. I the potential investors will simply
ence, of laziness, and worst of all; did not
always work for the best' think it can be done—a good start not invest their savings.. And the
0f individual selfishness.
I think 'interests
of America.
But have has been made—and at the same new shareholders would
get a betit is about time that the
govern- we forgotten?
If we have, then time we can get our national fi- ter return from their stock
than
ment and the
people get sold on it is time to remember.
nances
back
to
something
apthey are getting from their

aware

ment for too

courage,

with

last

Sure, there

The

built by courage and by faith, as
well as by material progress, we
have
permitted
those
without

system any of us
experienced or dreamed

ever

have

.n w,y

crackpots, and even the Commu- more important to
personal and
nists, won't seriously harm a great national welfare than all
of the
and strong
people once that people half-baked schemes of the social-

has

best

difficulty.

long,

"about

name

to :knock

endure and absorb them without
too
much

it
time.

about

the

namFtif

the

people

people that
is

moves

crackpots. And

railroad

you as

whv>HwLfin
What ft
why?

heaven

way

men controlling their

destinies

industry

for
tor

some of

candidates

man's

—in

taste
a taste
a

today.

nated

are

grew up in
bv

—

and

Ampri

America, of their
them

"ee will-to make'

ownership

If' fr^

for
for,

vnn

ing free enter¬
prise in Amer-

i<rto w aii

DurDose

gGS
: *be form .<? socialistic lie
government

as the
as tne,

run

mui?ltl.0n ,that
against us

simple,

out —who

tried to

with telling effect

taste

There

country

our

brought

consider-

are

whocanand willmv

of stock in

by
power A Program that must deliberately
fostef .
and a let-'em-eat-cake
^ antagonisms _ the
philosophy
this- case
that no people would stand for classes in
being - ecohomic groups. And this in a land
forever. And they didn't.

have

very

t^rim It
it

them
them

caused
caused

were
were

happening to

cure.

control

sciously want to destroy the Amer7
faith, and when we consider the
ican system. They are
intelligent, balanced best interests of all of
clever, and —I think —misguided, the
people and not just a few who
iHnriPst
which is the kindest
thincf
thing you would sacrifice
long-term
eco-

destroying
railroads,

the

kind

How

pressive regu¬
lation which
been

mere
neonle
just mere people,

ana

or-foerlnofawareof'theftThe

that

cans

land believe

our

tomeTeyssC For thT mosfpart it f^led then why do we continue
is our' oWn Fault
W^n the busi
accept competition ground the

;

exactly

<The

blessed land.

our

cause,

railroads. They are
starting posi¬
tive
action
here

here in

If the people of

pushfng "selves that has raised system'a ^stem
tnemseives ft ?****?«»
national
effective reach®"and control of
?3°° WWona a year and

V abuses which

water

iust

uT\,ll as
„J.our country, ana is Digger than
just

not
>t

race

the monies involved

able.

pusning

As citizens

by his Government. In
few brief moments of history, has man been free and well
a

ttme

projects to private companies under a plan
providing for ex¬
change of government bonds for stock of the new corporations.
Says this would effect a cut of $27 billion in the Federal
debt,
and

enslaved

•

De¬

socialism and collectivism,

and advocates sale of the tax-free Federal
power and

new

nessmen
messmen "ran the countrv''
ran tne
country

■

who

man

national office, but who

the country

over

of nationalization,

course

"a single

this

oppose

are

eirective

dicta¬

cises

much

off,

who

wno
who
'

Noted industrialist and former chief of Federal
Defense Mobili¬
zation attacks what he calls "the out and
out economic

never

only

Director, Office of Defense Mobilization

ruled" in the

what

right track.

A Few
Former

And

they have convinced many
good people that they are on the

worse,

& Co.

Financial Chronicle

The Commercial and
12

Thursday, September 18,1952

...

(1020)

cannot be so characterized,
event of real trouble, it
see how banks could

penses

Investment Status oi Bank

Stocks

is difficult to

the
fall

Bank,

Girard Trust Corn Exchange

sufficiently to meet
contingency of a substantial
in

cut

ELLIOTT FARR*

By F. W.
Assistant Vice-President,

the

Philadelphia, Pa.

expense

investments, and

off into

investments.

tions

of capital funds is a serious problem, because the cost
equity capital to a bank is relatively "shockingly high."
attention, however, to some favorable aspects of bank
as

art

investment,

ture.

The out-

They point out that this class

selling cheaper in

Another

funds

downward
adjustment in other stock prices.
Recent price action is more inter¬
esting than a long-term historical
perspective. From 1939 until the
end of the war, bank stocks did
relatively well
in the market;
quired

particularly the fire insurance
industry which has a long-term
investment record comparing fa¬
vorably with almost any other im¬

A little later we

portant group.

to compare the
banking and insurance industries
in order to bring out the similari¬
may

have

time

lated

stable
of

with
term

take

been

underlying growth factor to
of the rough spots along

They

while

long-term investments.
In the Aug. 18 "American Banker"
there is an article by Robert M.
Burns which states that the
15

owner

It seems

bank

to produce a
gain in net at a time when many
other
industries
had declining
expenses

tendencies.
a

As interest rates have

tendency to move in long secu¬

lar swings,

still buy¬
clear that the
has

consequence,

idly than

are

stocks

rose

great increase in loan demand in¬
creased gross earnings more rap¬

insurance fleets now own
$123,000,000 market value of bank
stocks representing 2% of the 33
b —ks under study and about 10
to
12% of total equities owned.
ing them.

expenses

last
low
alarmingly.

quick rise in interest rates and a

major

they

stimu¬

bank earnings
showed little increase and in some
cases declined until 1951.
Then a

Furthermore

was

by the tremendous increase

virtually ceased and, until
year,
interest rates stayed

institutions and by insurance com¬

panies

income

been

supply during the war
held down by
controls and by staffs reduced by
the draft.
Since 1945, however,
the inflation in money supply has

care

owned

has

record

and expenses were

earning power, dividends
continuity which compare
bond interest and a long-

way.

in money

have generally
well-to-do indi¬
viduals, by trusts, by charitable

the

Gross

poor.

Historically bank stocks have
been characterized by relatively

alternately

then

since

ties and differences.

this change has been

by some as a basic turn
in the trend of bank earnings and
heralded

been

example

ratio

from

1947

9.5 to 9.7 to 1.

S?un

This

will

same

jow

The

yield, this in

the

price ancj

tal

course

now

good company!

that so-called

turn depresses
have what ap-

This announcement is neither an

offer to sell,

nor a

offers to buy, any of these securities. The
made only by the Prospectus.

solicitation of

capital

of capiretained earn-

T+

NEW ISSUES

were

100,000 Shares
6% Cumulative Convertible First

Preferred Stock

Price
I

$10.00

per

Share plus accrued dividend
.

December,
occasions

SLnifiru TiJ,

know,

stability

—

stock since

five

maintain

separate

its

capital

the earnings per
share did not increase in the five
years through 1951 even though
the growth of the business was

—

particularly of divi-

been far more generous whereas
the Security First stockholders
have enjoyed large capital gains
at the expense of immediate income< ; j am hard put to suggest
which is the better nolirv hut am
inclined
of Jhe

to'he ^losophy

Security First under present trv-

+hl

;np. circumstance* which

anfi
hope the

f® :

portion of growth mieht

nanc

in net.

be preferable

not

book and to

overall return

sell

consequence,

5%% of which more than 90%
of the dividends after taxes stays

Some

Favorable Aspects of
Bank

Thus

far

Stocks

remarks

have

writing functions. Inreturnindus- Qf the hankers
this after tended to emphasize the trouble*
try, an aVerage net
miahf woii u
anri

insurance

such

balance

having
am

that

bearish

through

Iho^

imnression

favorable aspect

Many of the troubles cited ahnv®.
are

those attributable

fair average

inflation

fhf«nandng oVgrowT
Indus?™
*>een husbSingand^f^ite

5 Year bv
affected and to

Further' " the rate?
companies are not

to insure

Before I

£me

insurance companies have a

The

Joietz r™°„rlW°ormaf t
10%
to 12%
entirely normal 0f
upon

the fit-

in point is the very

1947
to

tw,

rnmSi!!! tK6

iXte thheerSmneedTS Ihisfn^trv m"Ch ^ tab°r not so
^
dilute the return. In this industry consequence are
based

case

interpreted

over

them
match

earnings to the detriment of divi- basis have increased substantially
dends. Again, like the banks, the as has the price. The dividend
iada^fy 1S characterized by great return of the Dallas bank has

50,000 Shares

cast.

premium

nancial ratios of the "Effete EUst-

long eners."

new equity capital
tax on net worth of 10% to 12%
shockingly high in is reasonable. Yet another differcomparison, say, to a good utility, ence between banking and insurA typical electric company is able ance is the relative cost of perto sell its common on the market sonnel as related to gross and net.

(#10 Par Value)

for

stock

bank

good deal of this

necessary

sufficient

cost

The

share but

hanks, this industry finds its stock different policy and now has a
s^ll".g at a. discount from Liq- deposit-capital ratio of about 16-1
uidating Value. Like the banks, compared with less than 10-1 for
°f these companies prefer Republic of Dallas. Its earnings
to build capital out of retained
the same period on a per share

High Cost of New Bank Canital
itign uosi oi J>ew uanx uapiiat

Farmer Bros. Co.

^ y u"
companies suffer very great. Security First Nafr®m ,a shortage of capital to meet tional Bank of Los Angeles, on
Sr°wing requirements. Like the the other hand, has followed a

"riskless

It must

evi-

Bank

C LJtlTf funds-deposit ratio at a level
2 hi
comparable to J. P. Morgan. As a

survive.

of the

romnarp

hank,

bank to have enough

case

gain would be cancelled out if it

Another advantage of the
insurance companies is that they
only survive but be able to meet make reasonable investment reits "social and business obligations
turn on invested assets and in
under economic pressure.
addition are paid for their under-

ficient for

offering is

the

Per

^^ith

guarantee
against their return. It is not sufyears

This

ratios

many

par¬

particularly

prices. I wish I could wholeheart¬
assets" such as government bonds dends.
But here the similarity
edly agree but there are a num¬
are less than a perfect haven.
ceases. The insurance companies
Bank Stocks Relatively Cheap
ber of negative factors to be con¬
The best arguments for a strong
invest their retained earnings unMany of the leading students of sidered. First, the possibility of
capital structure are that a bank der broad authority for maximum
bank stocks are bullish on the fu¬ many substantial gains in net is
in such a position can maintain its
long-term return, the retained
hampered by excess profit taxes. lines
*An address by Mr. Farr at the 35th
of credit under trying cirearnings pay their way. There is
Annual Convention of the Savings Banks
While this may be temporary, the cumstances
and,
perhaps, draw a large difference between investAssociation, Bretton Woods, N. H., Sept.
continued rise of operating ex¬ important business from less for- ing accumulation in a 3% bond
12, 1952.
tunate competitors.
The absence and netting 1%% after taxes and
of
such banking
conditions for buying a good utility stock at

and is

been

strong Republic National Bank

fbp

which many authorities
We

have
out

Banks yrith the weaker capital
induced by growth generally have fared best in earnings

vicious circle. Unretained and
earns a very low return

only slightly from 5 to 1 to a little
than 6-1.
This figure is the
faith.

business

America.

Company Stocks

less

their

West and, as a
the negative aspects

Dallas which has sold

capital of all member
6-1, it now stands at
14-1.
Fortunately the so-called
risk
assets ratio,
has increased

upon

the

dent in

A Comparison With Insurance

rest

the

credit.

ratios through

This

a rapidly
rising growth and by greater leverage.
Also, the westerners get
much higher average rates, due to
their concentration in consumer

period.

•

this.

tially cancelled

that the improvement

your list

money

fortunately
invested

cen-

to be

pears

was

one

old

is more honored in

Whereas, in 1929 the ratio of debanks

order

consequence,

banks

stockholder's lot only over a

the breach than in the observance.

posits

most

examples

good

stronger

conservative

very

for

For Morgan, this

follow.

course

tradition

stand

now

lag of the eastern banks is due to
the fact that growth
has been

dividend
provide the
necessary funds from within.
As
bank
stocks are usually bought

good. But what about
the banks with a 1-3-1 ratio which
have had a similar increase in
nave
nad
increase in
loans? Such banks used to justify
a thin capital ratio
by citing liquidity.1 While management may
now recognize the need for more
capital—it is often at a loss as to
10-1

consequence

p0iicies

is all to the

what

two California banks
are

ings |s effective in alleviating the

other hand the

!°,™S,rnilT
the
period.

bank, how-

tradition J,

conservative. On 1t
ratio ofcapit

The

avoid the capital markets and fol-

1951—apout
is

pay

book.

after taxes out of which it

pays

stable deposit capital

index

new

words,

illustrate this—J. P. Morgan & Co.

maintained

100, New York Cify bank stocks
represented by the Standard

Statistics stock

dividend of 4%. In other
new capital to finance a
growing business has a tendency
to hurt rather than help the stockholder for a considerable period,

As this short-term pa-

changed.

can

1 y2 %

mercial

have

so-

at about 116 which compares with

invest its new money at
about 3% maximum before taxes,

has converted itself into comloans, the situation may

per

ever, can

is the

ernments.

the

equity ters have done much better and,
at 10% out of in some cases, compare favorably
6% to 8% divi- with the industrial averages. The

puts

work

money

of the banks

problem

utility

which it

adequacy of capital funds—
relation to past prices than other
on a long-term
basis, the ratio of
investment groups. In a talk some
capital to deposits has been deago
Mr.
George
Geyer
by the market. The position of a time
teriorating. Nobody seems to be
trustee operating under the su¬ pointed out that as of October,
able to say what adequate capi1951 prices had not been so low,
perb "Massachusetts Rule" for fi¬
tal means and it is obviously hard
duciaries is somewhat different comparatively, for a generation
to do so because of changing conthan
the
position of a savings and that the relative gain since
ditions.
A few years ago, many
He sug¬
banker under a more restricted then has been modest.
banks
were
almost "risk
free'
authority.
I share the hope of gested that, to re-establish the since
their assets were so heavily
most of you that other forms of historical price pattern a rise of
concentrated
in short-term govas
much as 50%
might be re¬
equity investment may be opened
up,

electric

suspect.

Capital

Taking

earnings. We have noted that the outside the eastern financial

dends

dilution of net worth

II.

War

takes place but there is an even 216 for 18 Fire Insurance stocks
more significant dilution of, net and
206 for Industrials. Banks

point of opera-

World

called normal period of 1935-1939

If stock is sold for capital, it is
clear that

decline.

almost unIn the future,
not be so and the day

may

book value and,

natural consequence market
prices tend to be less than book
value.

probably taper

could be closer than

has been dramatic in the
market since the beginning of
ences

manufacturing but
to banking.

known

this

The effect of the above differ-

in the same

18.5%

income return

of stock is now

dignify it by that name, lies
in the selection of a portfolio from
the allowable alternatives offered
can

decline

14%

period.
The conservative dividends paid by banks give a low

concept well known to

Inadequacy
The

year

moderate

The break-even

higher operating costs, and says ade¬

stocks

last 18 months will

new

Calls

the improvements of the

fair but

points out bank stocks are now selling below the price pattern
of other classes of securities. Lays reduced bank earnings to

quacy

the

for

look

low interest rates and

volume

in interest rates or both.

of bank stocks

Mr. Farr reviews history

loan

increases in earnings on net worth terest rates and are only now getby a leading groun of industrials ting some relief,
from

strength

vear

the

hae

against heavv odds

thou" hthTiSket

may

have

(preferred stock" Banks profi,\il; is th?u'°b»?atio.n ofraise fused, in many eases, to neverthethe the progress it is there recognize
Banks, regulatory
authorities to

Common Stock

money and preierred stock.
money and

(#1 Par Value)

A- raKl,eS \° COTrl°7h levelnan ieasPaTta7hVlp^neX
ori nit
whlch V? *e Past ,hf felt. Further, the banking system
estimate that ^7'5 if'^Lttoe^' hS I tart mf"
°'
mark
iL tT
llfe by seeking and finding new
to

Price
;■
r

$2,375

per

setT and about 61
worth? For 1952, I

Copies of the Prospectus may be obtained from
only such of the undersigned as are licensed or regis¬
tered brokers or dealers in securities in this State<

to 8%

win not hp far from

the

The Massachusetts^ list Ts a Lly! The banks, on the other hand, markets at the consumer as well
Massachusetts list as a have pnces controlled to a large as the producer level. Such exA study which
made some ix.tent^y government policy but pansion is expensive in terms of

for
•

whole

P. W. Brooks &
115

Co., Inc.

Broadway, New York 6, N. Y.

ath° Sh0Wed tdatrr0m 1936 t0
s0' lnerneer worth Rnoemln8rrto

1950

6.1%

Dempsey-Tegeler & Co.
407 North 8th Street, St. Louis 1,
September 17, 1952

Mo.

for

New

York

banks,

Baker, Simonds & Co.

*
r

from 8.4% to 7.1% for seven other

Buhl Building, Detroit 26, Mich.

typical Eastern banks, from 9.6%
to
9.4% for 8 leading Western
banks.
The nearer the financial

the perform—
This record contrasted with

center,
ance.

the

poorer

to'mPe°et1Cthe 'leedT ofTe

toks

aS SUch' Which of us will live to
see the day when the Treasury

personneTbu'rin ft^foTg^run "it
Luld provid4 a s^dK

base of earning power,
*f>
tbe years to come, inflathe poor
^ianary factors are brought under
„LP °f ZZl reCnV For 20 ^ore reasonable control, it should
need ofa 1®rge,r raturn' F°
be Possible to stabilize operating
the bsnks hsve suffered ratios with the result thst bsnlc
from rising costs and falling in<
Continued onpage4Qt
interest rates because
vendors of money are in

wilL raise

Volume 176

Number 5152

The Commercial and Financial Chronicle

(1021)

tion"; "offer to sell"

The IBA Model Bine

Sky Laws

sale"

would

"offer for

defined

mean

issued by

a new company

securities

were

By GORDON L. CALVERT*

"every attempt or offer to dispose
of, or solicitation of an order or

such

offer to

buy, a security or interest
in a security for value"; and it
would be unlawful only to sell
securities prior to their registra¬

desirable

tion.)

General Counsel

Investment Bankers Association of America

After stating prevailing problems created
by Blue Sky Laws,
IBA official explains provisions of the two model laws
proposed

by the Investment Bankers Association.

(2) Under the blue sky laws of

Describes difference
between the "notification" type and the
"qualification" type
laws, and concludes an effective blue sky law is one that per¬

mits

reputable dealers

the

first

annual

the Investment

ciation

referred

the

convention

buy

(hereinafter

IBA)

solicitation

the

Since

laws

entitled "Blue

Their Relation

have

"sell"

Investment

Bankers." The

under

pro¬

firmative

state

praiseworthy
objective of
blue

that

Gordon

L. Calvert

the

(ii)

price,

The

able

transactions

(iii)
the

securities is avail¬

recognized

securities.

manual

exemption for such

should

subject to

authority of the commissioner to
revoke

the

exemption

with

re¬

spect to any securities whose sale

buy

laws

such

would-work

fraud

states also expressly forbid

that

tend

purchasers.

work

We believe

above,., although not as liberal
as exemption provisions for sales

suggestions

work

the

IBA

adopted

were"

blue

one

have

and

registration

sky laws has been

The

principal activities of
since.

This

originally carried on by The
State
Legislation Committee of
the IBA, with the assistance of

herring

the

such

war

Counsel

and

securities.

that

ruled

prospectus

attempt

would

subse¬

both

is,

sell

the

prospectuses

that

prior

registration of

Arthur

scribed therein in those states.

Davis

who

tary,
whom

many

remember),
with

(IBA

the

Field Secre¬

retired

1948

the

but

General

you undoubtedly
cooperation first

National

Association

other

that

Supervisors of State Banks and
then, after its organization, with

ring

National

the

Association

Administrators

individual members.

the

IBA

sky laws

with

The position

the

inception

Association

has., favored

from

and

the

includes

IBA

its

writing

firms,

banks

and

several

•

the

Colorado

Act.»■ The

investment trusts, it is

V :s

respect

statement

which'
has

those

though

even

securities

does

statements"
as

price in

excess
/

of the fair and

book

value

thereof,

unless, if such stock is; common
stock, the same can show average
income

net

Sky Problems

Blue

; r

for

one

year

ties described

When the
SEC
in
1946
adopted Rule 131, permitting the
use of the
so-called "red-herring

fore

not

less

than

and not

the

prospectus" prior to the effective
date

registration
Securities

Federal

under

Act

the

1933,
the industry was confronted with
the
it

would

effective

public

date

not

dis¬

red-herring
the

pectuses

whether

permissible

such

tribute

the

problem

pros¬

prior

registration

of the securities described therein

under
Rule

state

the
131

blue

requires

sky

that

laws.

there

printed in red ink on every page
of
a
red-herring prospectus a
legend stating in part
tion

herein

contained

formative

"Informa¬
is

for

in¬

only, and

purposes

subject to correction and change
without notice.
stances

prospectus,
♦Statement

it
or
by

discussion at the

Under

to
as

be
an

Mr.

offer to sell,

Calvert in a panel
Meeting of the

Annual

National Association of Securities Admin¬

istrators,

Portsmouth,

H.,

1952.

Sept.

blue

immediately preceding the
application." This provision would

obviously; forbid the registration
in

that

state

desirable
to

permit

common

from

IBA

stock

Third

few states it is

other of the notification
type.
IBA Model Blue

stockholders of the issuer in

com¬

pliance with "pre-emptive rights"
of those stockholders.

such

We believe

offerings

the

because

laws

the

existing

(as they

are

states)
of fraud

many

possibility

is negligible in such transactions.

(5) Although the National Asso¬
ciation
tors

Securities

accomplished

Administra¬

much

its

Both

model

Sky Laws

laws

require

their

securities

own

securities

are

dealers.

shall

and

that

(unless such

exempt) to register

Both laws declare that

fraudulent practice

shall

unlawful

make any false statement

mature

To be

carefully the

fraud

chaser

deceit upon the pur¬
seller of securities. The

initial work in preparing the uni¬
application form for use in

fundamental

applying

notification type law provides that

form

for

registration -of

se¬

curities
been

which are being or have
registered under the Federal

Securities Act of 1933, many states
have not adopted that form and
states

some

permit

its

only

use

with specified supplements. Since
the
mechanical and substantive

problems

are

enormous

com¬

the

two

the

intent to sell,

quirements

not

accept
form

ments

those
the

qualification,

the

amend¬

blue

sky laws of
states to permit the use of

uniform
a

application
form
requirement for addi¬

much

Act

1933

would

simplify the registration

process.

certain.
these

is difficult

laws, because

biguity1 and
reluctant to

many

the state.

dealers,

do business

States because

are

these

they would subject

This problem can be solved most

Aside from this funda¬

to offer to sell securities

(but not

sell

contract

it shall be unlawful to sell
any
securities within the state (except

exempt

securities

and

Such

under

provisions

the

commissioner
to

sell

such

notice

sky law.
already in

prescribed
are

filing fee.- If the se¬
registered under the

Act
of
1933,
the commissioner shall
accept the
prospectus filed under the Federal

Securities

Act

of'

1933

blue

against-fraud Securities Act of 1933 is completed
clarify requirements for either by delivery in the office of
Continued on page 38
compliance with the law.;
rv
effective protection

and; to

$2,880,000

Equipment Trust of 1952
Equipment Trust Certificates
to

September 15,1962, inclusive

yield 2.15%

3.15%, according to maturity

HALSEY, STUART & CO. Inc.

McMASTER HUTCHINSON &. CO.

sale

curity
for

value

make

"every

other disposition of
or

any

interest

WM. E. POLLOCK &. CO.,

se¬

security
every contract to
such sale or disposi¬

and

INC.

September 11,1952

all

of intention to sell is fited under
sky r laws /should be the model law; Filing for securi¬
adopted in these states to provide ties registered undej? the Federal
new

THE ILLINOIS COMPANY

"sell"

mean

with

amendments to that prospectus as
of the date on which the notice*

FREEMAN & COMPANY

(Specifically, "sale"

Securities

R. W. PRESSPRICH &. CO.

would be defined to

in¬

prospectus meeting prescribed re¬
quirements
and
payment
of
a

blue sky laws of Massachu¬
setts, North Dakota and Wiscon¬

the

securities,

sell)

blue

are

securities

sold in exempt
transactions) until
there shall have been filed with

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 circulated from only
such of the undersigned and other dealers as may lawfully offer these securities in such state.

prior to the registration of those
securities

type provides that

The
;

laws

Specifically, the model law
the notification

Issuance and sale

directly by making it permissible

re¬

payment
of
a
filed with the com¬

purchase those securities.
-

notice

and

are

difference, the two
substantially identical.

Federal

am¬

mental
are

curities

their

together with

specified exceptions)
registered by qualifica¬
before they may be sold in

enforce

soon

un¬

are

(with

tention

compliance with the law

the

type law requires that all securi¬

tion

between
that

missioner, while the qualification

tion

curities

state

filing fee,

ments of different states which do

uniform applica¬
registration of se¬

prospectus meeting prescribed

must

the

laws

plying with the varying require¬

for

difference

model

non-exempt securities may be sold

ties

$144,000 semi-annually March 15, 1953

rep¬

or
to engage in
any
practice which operates as

guaranteed unconditionally as to payment of par value and dividends by
endorsement by Erie Railroad Company.

Priced

they

resentation
act

(Philadelphia Plan)
To

the

registration of dealers and sales¬
men
and require issuers
selling

securities

before

re¬

neces¬

to register securities which
being offered only to existing

securities

law.

members

prepared two com¬
plete model blue sky laws, one of
qualification
type
and
the

sary
are

2%% Serial
it

public interest
dissemination of

order

sky

the

Erie Railroad

give in¬
opportunity to consider

both

under

that

regarding

and to examine

merits

(4) In

■;

prior to the registration of those
an

quests

response

sky laws.

the

securities

blue

new

the

information

vestors

complete

Consequently, in

with

there¬

securities

obvious

appears

construed

and

can

laws, but in many cases there is
urgent need for the enactment of

sin.

circum¬

considered

state

problems

filed/: under

therein

those

than five

unlawful prior to the regis¬

tration

nesses.

offering; price pdr themselves to 'undetermined lia¬
period of not less than bilities. We believe that complete

■

(1)

these

registration

been

would

admittedly speculative busi¬

of the. proposed
year

attempt to sell the securi¬

curities to finance fair and honest
but

blue sky law is

readily ap¬
the Federal Securities Act of 1933.
parent why the IBA is vitally,
Now the investment banking in¬
interested in blue sky laws and
dustry isconfronted with
the
problems under those laws. Some
problem of whether or not the
of the problems which presently
distribution of such "identifying
concern us are the following:
;

sole test for

(6) In several states the present
provision that
so antiquated and
commission "shall in no case ambiguous that
requirements for
state Contains

y years

l>ertnit' tethe ' distribution to i the
public of an ^"identifying state¬
ment"4 regarding^ securities

securities

reasonable

the

sale

the

pros-

adoption of Rule 132 which would

its

commercial
sponsors' - of

Some

be solved
satisfactorily by specific
amendments to existing blue sky

denying and from state securities commis¬
registration of securities, in order
sioners for model blue sky
laws,
to permit the
registration of se¬ the IBA has

(without

few states the blue sky

authorize the sale of any stock at

Securi¬

red-herring

work

curities

one

de¬

Recently the SEC proposed the

principal under¬

many

securities

exempt transactions.

present membership of about 765
firms most of the

the

problem under the
state blue sky laws, tu dealers and
sophisticated buyers to whom se¬
curities may in most states be sold

now

J/ '-'''-v.v

Since

violate

cause

favors constructive blue sky legis¬

lation"'

the

tendency to

registered under the Federal Se¬

the

red-her¬

prior

fraud

ar¬

not involve any element of fraud.
For example, the blue sky law of

blue fpectus has been distributed almost
1915 exclusively, perhaps partially be¬

follows:

'•

bases for denying the
registration of securities and to

make fraud

classes

5, 1947, ruled

distribution

arbitrary

bitrarily forbid the sale of certain

letter

under

laws contain provisions which

Attorney

Colorado, in

prospectuses

ties

report of the IBA General Counsel,
as

the

not

respect to

the

such

tional supplements) for securities
which
are
being or have been

(3) In

de¬

scribed therein in Colorado would

its

stated in the

was

registration of

Se¬

and

hand,

securities

under date of June

curities

the

market

sale of fraudulent securities.

the

quently with the assistance of Mr.

secondary

by registered dealers in the
secondary market and provides
adequate safeguards against the

distribute

the

ing

red-

effect,

and

unlawful

the present blue sky laws of sev¬
eral states, greatly facilitates trad¬

Attorney General of Florida
Attorney General of North

Dakota

General

those

and the

work

ever

that

eliminate

under

participation

its Legislation Committee prepare
ing an offer to sell the securities
a
model
blue
sky law. 'Those* described therein prior' to
the

should

believe

stockholders should be treated

not

exemption provision em¬
bodying the conditions suggested

IBA

value

that

the distribution of any advertising
material containing or constitut¬

the

price

they

underwriter

issuer of

distribution

offer

if those

current

controlling person, and"
basic /information
regarding

any

specific problem
sky' laws was

securities.

many

sky laws

and

those

are

the; legend; on its ; face,
an attempt to sell or a

solicitation

We
to

exempt transactions

constitute

the

book

constitute part of an unsold allot¬

red-herring prospectus would,

ac¬

the

ment, subscription

specified

include

not; the

despite

gram" to
complish

market

se¬

solicitation of

blue

such

"af¬

ties by the issuer, an underwriter

defined

whether

should

sonably

se¬

previously
the
public
sold
by
prices rea¬

requirements

offer to buy, the

gested that the

distributed

(i)
they
registered dealers

such' securities

filing

attempt to sell

sug¬

have

when

should

necessary

which

that

complied ; with,, and

been
is

believe

participant
in the distribution of such securi¬

certain

IBA
offer

any

certain

until

been

states

have been registered in the

Sky Laws and

speaker

sell

(with

exceptions)

blue

not

the

than

curities

offer

excess

ties.

referred

under

unlawful

curities

was

securities

herein."

ad¬

dresses

securities in the secondary market
as well as to new issues of securi¬

purchasers.

sky

1912

the

principal

fraud

the

Bankers Asso¬

America

one

registration re¬
quirements extend to the sale of

to conduct

forbids sale of securities which work
At

several states the

legitimate business without
restrictions, but prevents fraudulent activities and

unnecessary

r.-

priced at

securities.

Assistant to

•

Financial Chronicle

The Commercial and

(1022)

Thursday, September 18,1952

...

but the large extra

New

Missouri Brevities

Investing Course Annnounced

There
is
no
outstanding
and
consists simply of
of 4J/2% preferred
stock, par $100, callable at 105,
and 364,017 common shares.
•
Capitalization:
debt

funded

Burke

City
of

MacDonald of Kansas

Sept. 3 made an offering
of common stock

4,500 shares

owning 60,678 shares. A declara¬
tory judgment to determine the
rights of all voting trust certifi¬
holders

has

of United Film Service, Inc., Kan¬

cate

City, at $5.50 per share. The
net proceeds from the sale will
be used
for additional
working
capital.

trust

been

capitalization
58,969 shares

by the plaintiffs.

sas

Plaintiffs
the

requested

Price

both suits contend

breached

trustees

the

year

trust

Auto Supply Co. re¬ terminated for some holders and
that its sales for the first not for others.
The
action
is
being
pressed
eight months of 1952 exceeded the
like
1951
period by more than principally by St. Louis interests.

York

Stock Exchange.

record

551,000, compared with $103,441,000 a year earlier, or a gain of
4%. The dollar volume in August
1952

with

compared
earlier, a

$17,207,000,

was

$16,139,000

year

Consolidated

six

preferred
$29,789,

year

the

22 cents per

net

profit

amount

cover

ments for that

ferred shares.
pany

total

require¬

period on the pre¬
However, the com¬

expects the 1952 earnings to
about $300,000.

after
year and

was

only

of $16,684,

for
or

share, against $26,162,

cents

per

share,

year

earlier.

which
enough

than

dividend

the

The net
$10,000 this

company

produced

$204,519,

was

report.

months

six

first

The
a

interim

39 cents per share,

The report showed earnings

second hahYof 1952 as in the first

half, the company informed stock¬
in

compared

stock,

The

per
on

accumulations

unpaid

the preferred

share, or

$12,500 in the like 1951 period.

earnings to accrue in the

holders

per

earlier.

reserves

Company cannot expect the same
rate of

its
Wilfred

Benjamin Graham

May

Lasser

stock totaled $28.25
a total of $2,148,723

10-weeks

course,

"Investing Today,"

♦

More than

90%

War

writer; Benjamin Graham, author and President of
Corporation, a mutual fund; and J. K. Lasser,
at the New School for Social Research on
Thursday, Oct. 9, at 5:20 p.m.
The series is designed to give practical and constructive help
in the general and specific problems of the layman as well as
brokers, investment analysts, trustees. Special emphasis is laid on
investing media and aids; how to deal with inflation and defla¬
tion; appraising individual issues; planning a specific investing
program; family financial problems and estate planning; how to
read the financial page; the stockholder's status; investors' tax

cers

lems

special interest.

summary,

appears

page

tion

The
of

name

American

Beet

Sugar

most

years.

financial

plants and

in about 13
comparison of pretax
to

Sugar

the

underlying

the situation. It should,

market, rise to a value more in
line with its earning power and

present investment in

equipment

Crystal

to be very cheap in rela¬

apparently, hold up satisfactorily
in a bear market or, in a bull

Security I Like Best

Company in 1899. Although it has
experienced hard times, particu¬

then, the common

American

factors in

shares of Mission Oil Co. of Kan¬

That

with whatever prob¬
arise.

cope

may

stock

of the common

profit, if realized, will be sas
City have been turned in to
short of the year's dividend re¬
the Commerce Trust Co., deposi¬
quirements of $324,312 on the pre¬
tary, to receive stock in three
ferred stock.
companies.
"
The expected earnings for this
Under the dissolution program
year
still would be the largest of
Mission, each share is to be
since 1946, when the net totaled
surrendered for one share of com¬

cut

from

The management

to be thoroughly cap¬
has sought aggressively

crop

questions.

Continued

❖

has

costs by mechanization of
cultivation and harvesting,
by more effective weed control,
by improved methods of storing
beets, etc. The record of the com¬
pany
is such as to inspire con¬
fidence in the ability of its offi¬
to

authority, opens

Individual counseling is offered on problems of

and

reputed

able.

Graham-Newman
tax

present

14. At
seems well

32 lfi
price, it

Management:

by A. Wilfred May,

economist and

30.

June

World

price

deflated.

$30,612,

was

cents

the

Service

Public

City

income

1952

tov40

end

high

ranged between

i;.

Kansas

months

equal

It has sold
of 108 V2
record low of V\. Since

at a

the

Theodore Gary & Co. for the first

with

gain of 6.6%.

net

and

the same as the
outstanding 50 years ago
was ^listed on
the New

when

Western

Total sales were $107,-

indicated

essentially

common

ports

$4,000,000.

History:

earlier, the present common stock

voting

earlier this

agreement

permitting

is unlikely to

duplicated in the near future.

strength.

zero

Dillon, Read Group

with Federal income tax
there was a mon stock in Southwestern De¬ never been in bankruptcy. The charges makes it appear that more
deficit of $19,682 and in the two
common
stock outstanding today depreciation has been shown on
velopment Co., Colorado Interstate
years
previous losses also were Gas Co. and Westpan Hydrocar¬ is, to all intents and purposes, the reports to stockholders than
shown.
Y '■
the
Y; i;:.' ■
original
stock
since
there has been allowed for tax purposes.
bon Co.
have
The company charged off $226,been neither split-ups nor If this be true the time will pre¬
Of the 344,100 shares of Mission
Dillon, Read & Co. Inc. heads
041 for income taxes in the six
reverse
splits. However it has sumably come when the annual
Oil Co., 312,861 shares have been
an
investment banking group
months
of this year, the figure
been changed from $100 par to depreciation
charge on existing
exchanged since the offering was
which released the offering to the
no par and then to $10 par, each
plants will have to be reduced,
being computed on the "single made early in August.
public at the close of the market
year" basis of 1952 without con¬
Ijjme on a share-for-share basis. causing a corresponding increase
yesterday (Sept. 17) of new issues
in reportable income.
sideration of any possible effect
r uThe company has nine factories
of
90,000
cumulative
preferred
thereon
of
the
"loss
Assets: The book value of this
carry-for¬
Kansas City Life Insurance Co. capable of handling a total of over^
ward" provisions of the tax stat¬
issue on March 31, 1952 was about shares, 4.65% series of Columbus
reported
its
agents
submitted 18,000 tons of beets a day. Among
& Southern Ohio .Electric Co., at
its other assets are some
utes. As of June 30, current assets
10,600 $72 a share, unusually high in
5,201 applications for $25,814,738
$100 per share, plus accrued divi¬
were $2,423,080; current liabilities,
of insurance in August, the great¬ acres of farm land, a small rail¬ relation to the price of the stock.
dends and 300,000 common shares
water
rights. Yet as is true of so many cor¬
$2,408,950.
The long-term debt, est volume and largest number of road and certain
at $24.87 V2 per share of the same
mortgage, bonds and equipment applications ever received in any During
the
fiscal
year
ended porations today, it appears that
Y/; .v."'Y. ■:,. Y
Y
notes, were $2,488,036, against $3,- one month. The previous high March 31, 1951 it put out : just the assigned values of assets are utility.;
Proceeds from the sale will be
017,860 a year earlier.
mark was in August, 1950, when over 451,000,000 pounds of sugar, conservative. It would seem that
added to the general funds of the
* •;
$ 4s,
y"'.-.
y
4,924 applications were submitted a record high figure, while this a modern beet sugar factory costs
company and will be available for
for a total volume of $25,226,983, past year's figure was about 436,- about $3,000 per ton of daily beet
American Asphalt Roof Corp.,
construction of additional electric
000,000 pounds.
capacity. The old mills of this
soon to be dissolved and its assets
properties and for the payment,
It is interesting to note that the company
were
carried
several
taken over by the Ruberoid Co.
in whole or in large part, of bank
Phelps, Fenn Announce
largest factory is almost the old¬ years ago at an average depre¬
of New York, reported sales for
loans obtained for that purpose,.
Phelps, Fenn & Co. 39 BroadT est. The one located at Oxnard, ciated value of only about $400
the first half of 1952 were $4,934,The company has spent over $67,California, was constructed in 1898 per ton of daily capacity, and
786.
Net income for the period way, New
York City, announce
000,000 on electric plant additions
and has a daily capacity of about doubtless have a somewhat lower
amounted to
$186,636, equal to that Wm. H. M. Fenn has with-i
during the past five and a half
3,000 tons of beets. The
most net value now. Granted that they
$2.82 per share on the common drawn as a
general partner of the modern plant, at Moorhead, Min¬ are old, and less efficient than years and expects to spend $46,stock. Income taxes for the period
500,000 more during the two and
firm, but will continue as a lim¬ nesota, considered to be one of new factories, they still appear to
were $225,989.
half
years
ending December,
the most efficient in the industry, be worth more than the figures at a
A second group of stockholders ited partner.
1954.
At the E. M. Poston gener¬
was
completed in 1948 and can which they are carried,
of Pickering Lumber Corp. have
v;
Investments in buildings, equip¬ ating station near Athens, Ohio,
process about 2,500 tons a day.
sought to have their holdings freed
work has been started on a fourth
Gilchrist, Bliss Adds
Our
analysis
indicates
that ment, machinery, etc., were more
from the voting trust that has con¬
generating unit of 60,000 kilowatt
Gilchrist, Bliss & Co., 488 Madi¬ American Crystal Sugar common than 60% depreciated at the end
trolled the company since 1937.
is
an
outstandingly
attractive of the latest fiscal year. This rating, scheduled for service in
A motion and petition to inter¬ son
Avenue,
New... York
City,
Y,
«'
equity for the reason that the seems conservative and appears September, 1953.
vene
in a principal suit filed in members of the New York Stock
The company, supplies, electric
present price of about 23 appears to bear out our thought that re¬
Kansas City by 12 holders in June Exchange, announce that S. War¬ to be distinctly low in relation to
ported depreciation charges have service in portions of 23 counties
have been filed in Federal Dis¬ ren Auerbach has become associ¬ most of the factors which deter¬ been higher- than those allowed in central and southern Ohio, in¬

$378,364.

Last

early

the

larly

has profits

1930s,

year

Offers Gol. & So. Ohio

Electric Go. Securities

•

■

•-

trict

Court

171

shareholders

yY Y

Olin Industries

a common

discussed in the

First National Bank

earnings
$4.30

Miss.

Valley Gas

five

;

Scruggs-Vandervoort-Barney Com. & Pfd.
Tenn. Production

years

Sold

—

Bell

Teletype

SL 456

St.

Quoted

American

1951.

Exchange

share. While

that this figure

average

L.D. 123

our

studies

not

may

duplicated in the near future,
believe that over th$ next few

exceed $3.50 a

Garfield 0225

was one

interesting

income
nual

earnings
share.

account

should

the

feature of
the high

could

write

down

the bal¬

also

the

owns

all of the securities of

Columbus Transit Company

which

$4,800,000 before taxes on operates a street transportation
the gain. Consequently it seems system in the City of .Columbus
and
its suburbs.
Columbus and
likely
that
remaining
acreage
with a book value of some $1,- Southern is one of a group of 15
700,000 is worth more than that companies that have submitted a
proposal to supply power to the
figure.
contemplated
Atomic
Energy
Working Capital: The previous¬ Commission
plant near Piketon,
ly mentioned sale of farm lands
Ohio.
resulted in a great improvement
in the financial strength of the

about

Elected Directors

Current assets less all
preferred stock are

and

DALLAS,

Texas.

—

Harold

equivalent to over $32 per share
40% in excess

Byrd, President, Byrd Oil Corpo¬

of the market

of common or about

price.
For about

Dividends:
dividends
rate

the

corporation:

During
total

the

Arthur S. Grossman,

occa¬
over

Jr., President, Dallas Rupe & Son,

regular disbursement.

Dallas, and Mark J. Millard, part¬

paid

quarterly with

extras.

six years

partner,
Straus, Blosser & Mc¬
Dowell, Chicago; D. Gordon Rupe,

been

have

30c

ration, has announced the election
the following directors of the

The

yield

the

an¬

depreciation charge which in

theory

sheet at about $2,100,000 for

ance

sional

cluding the Columbus area, from
March 31, which approximately 76% of its
Crystal disposed electric revenues are derived. It

year

of farm lands carried

company.

indicate

Building

Louis 2, Mo.

the

liabilities

years
Stock

i. During

just ended

best in the

"common

SCHERCI4, RICHTER COMPANY
Landreth

years.

for tax purposes.

company's history
with net income equal to $4.55 a

the

Member Midwest

the average was $2.10
the decade .to

31," 1942 the corresponding
figure was $1.82 a share, Profits
have been reported for 19 consec¬

March

The year

Wagner Electric
—

1952

the common averaged
For the preceding

while for

share.

utive

Natural Gas & Oil

Bought

ending on March 31,

years

National Oats

Moloney Electric Class "A"

are

following paragraphs.
Earnings: The trend of earnings
has been upward, particularly in
recent years. For the five, fiscal

Ely Walker Dry Goods Com. & Pfds. r

stock.

mine the value of

These factors

ated with them.

latest

$2.65

fiscal

year

was

paid

ner,

New

Carl M. Loeb, Rhoades & Co.,
York

City.

v.W

Volume 176

Number 5152

The Commercial and Financial Chronicle

(1023)

registration

Objectives in State

legislation

Legislation

S. VRTIS*

*
'

would

doubtless
naive

pect

unanimity
viewpoint,
that,

■.

-the
*d i

•there
*

-mate

the

-form,

Law

Charles

shall

basis.

.expressing

V,ri,»

part

our

perfectly

frank

views, which in
feel is desirable in

objective explora¬
We shall do so even though
know

may

views

.express
<

posed

that

shall

diametrically

those

held ;by

friends

good

-our

op-

some

the

among

of
se¬

curities

administrators, for whose
-sincerity and honesty of purpose
have the most

gard.
the

wholesome

re¬

in short, to let
where they may,

propose,

chips

.and

fall

assume

would

you

not

.vwant it any other way.
As

have

appreciate,

securities

the

various

laws

states

-importance, not only to the people
the

ican

country, but to all Amer¬

industry.

establish

is,

the

have seemingly similarly failed to

Philosophies

the statute
states.

ous

now

tional; Asssociation

Securities

Dealers, Inc., the membership of
which is comprised of the vast

with

but

ment.

for

presented

general

and

may

said

simplified
school

one

thought emphasizes the registra¬

tion of dealers and the prevention
of

the

fraud;

emphasis

other

ptaces

the

registration, of
securities, while at the same time
requiring the licensing of dealers
as

such.

Under daws

type, the

concern

licenses

only

adequate

the

first

is to issue dealer

the

upon

financial

showing
responsi¬

bility and that the principals in¬
volved

are

of character who,

men

training ,and

experience,

are

deemed qualified to engage in the

securities business.

In such cases,

other things, is concerned

imperative

course,

investors

that

ef¬

action

important

deciding

note

the

upon

curities they wish to deal

day to

day operations.

impediments be placed in the
of
having the savings of

proach

and

people

available

American

industry

our

These

are

can

by all of

made
needs

and

free enterprise

serve

us,

institutions
finance the

pre¬

system.

principles that, it

seems

safely be subscribed to

and

think

tion

has

been

the

investing

public

will

have

soon

completed 20 years during which
both
and

the

Federal

Blue

Sky

Securities

legislation

Act

the

.great majority of the states have
been

effect.

The

range

fraud

not of

experience should be adequate to

rattain

This

the

act

dealer

this

full

which

disclosure

the

Federal

been

theory

of
State
commissions,
functioning under laws of the se¬
the

effect

counsellors.

have
on

role

other words, they

attempted to pass judgment

the

investment merits and the

underwriting terms of

new

seeking

qualification; as
the adequacy and

upon

curacy

the

established.

Under

reversed.

Here

licensed

required, except

types

securities

When

consider

the

uniformity in present state

regulation and the duplication of
requirements and attendant ex¬

arising mainly out of lack
integration even at this late

pense,

date

Act,

with

the

does

Federal

indeed

Securities

in¬

appear

cumbent upon legislators and
'Statement

Mr. Vrtis in a
discussion of "Blue Sky Problems"
Annual
tion

se-

the ac¬
information fur¬

beyond the practices of the

Securities and Exchange Commis¬
sion

interfering

with

the

Meeting of the National Associa¬
Securities Administrators, Ports¬

mouth, N. H., Sept. 4,

1952.

...

contrac¬

tual freedom and

possibly beyond

the

very

intent ,of the

which

they

operate.

law under
Under

this

illus¬

This

announcement

which

may

In fact,

the

mutually

the

States

aroused to the point of

instituting

most

remedial

but, to the best of

measures

knowledge,

our

date.
In
to

final analysis

the

that

State

the

human

only to securities that

atively registered
often

price

requires,

approval

and .the

affirm¬

are

under

the

regulation

element.

People

make

errors

the

amount

and

might

systems

are

expected,

usually

ties be based upon, and limited to,
observance of the principle that

and

this type do get sold
for the simple

and distrib¬

there

demand

uted

rise

the

type that

issuance

that

reason

real

very

such

for

gives

options.

Issuers, furthermore, of securities
this type usually are managed

and

there is

no substitute for integrity?
engaged in the origination

Those
and

distribution

whether

brokers
moral

acumen.

short, they
are disposed
play the role of Santa Claus;
they want, instead, at least 100%
type who

value

made.

for

securities

salesmen—have

^expenditure

every

account the domain

the

Securities

Commission,
the entire
to

govern

necessary qualifications elsewhere.

subject

general

types

discussion.

laws

Based

now

our

and

ers

such

vania, have produced

best overall results and have been
most

conducive

efficient

economical

operations.

experience

selves,

the

might

and

As to ,the

States

them¬

wish that

even

thought the experience of the
States employing the security reg¬
we

rior

the

other

was so supe¬

make

its

clearly justifiable. This, how¬
we find it impossible to do

use

ever,

the basis of the record.

What

this
tion

has

recent
able

know

for

certain

type of paternalistic
not

years

business

from
losses.

prevented,

even

generally
conditions,

sustaining

that

regula¬

seri¬

very

does not constitute

dedicated

to
and

Glenmore Distilleries

making
which

loans

tive

Along with

and others, the

you

Investment Bankers Association of
America

has

long

been

version of

model State Blue

Act of the notification

which

are

available for distri¬

bution to any who are interested.
Later in this panel discussion MrGordon

Calvert,

Assistant to

tendency

opinions

and

prac¬

change

under

sions of this model act.

new

pear

13.]

should

say that, while this
quite possibly is subject
improvement and refinement,

model act
to

does, in

the

our

essential

opinion, constitute

framework

Continued

registered dealers in this State.

Company

Glore, Forgan & Co.

tadminstrations.
The passage

of the Federal Se¬

curities Act of 1933 placed

security

Hayden, Stone & Co.
Shields &

White, Weld & Co.

Hemphill, Noyes, Graham, Parsons & Co.

Company

only to

page

plus accrued interest

Incorporated

[Ed. Note:

Text of Mr. Calvert's remarks ap¬

A. G. Becker & Co.

the

General Counsel of the IBA, will
discusss the more salient provi¬

unfortunately, have

Sky

type, copies

wide variety of administra¬

rulings,

studying

this problem and has prepared its

Due August 1,1972

Corporation

secondary

The IBA Model Blue Sky Law

security

The First Boston

value.

Sinking Fund Debentures

Price 100%

flatly treats

(a Delaware Corporation)

Dated August 1,1952

evidence

offering. The offering is made only by the Prospectus,
as are

past ob¬

principles and

collateral security as of

It might be contended

limit

securities

based

recall

character

favor¬

inves¬

sell

of decent

now

then

not

of State regulation

deviation from such principles. In
other words, why not a statute

prevention of fraud,
for example, the statute

Pennsyl¬
by far the

character loan,

the

as,

of the Commonwealth of

license

why

area

Exchange

other

registration process. The system,
furthermore, is complicated by the
fact that it comprises, in effect,
not
only the statute itself, but

great

allocated

now

and

elaborate

the

application of the concept that

servance

—

dealers,

responsibility, that of hon¬

practical matter, un¬
simply
by-pass
the
troublesome States, and effect any
a

derwriters

ous

issuers,

by men who pos¬ esty and due care, which no gen¬
only vision and imagina¬ tleman will shirk, hedge or other¬
but also a high degree of wise seek to evade. Taking into

not the

are

tors

of securi¬

not

financial

controls

controlled

sess

should not the

act.

provided

and.

attitude, the fact is that issues of

of underwriters' compensation. As

statute

People

conclusion is correct, and to us it
seems incontrov
ertible, why-

$12,000,000

form

the

financing essentially
situations, both large
small. Despite the prevailing

tive ways of

risk-type

September 12, 1952

offering

commit

commission

registra¬

among

appears

frauds; securities do not.

NEW ISSUE

transac¬

specifically
exempted
by
statute, to confine their dealings

also

really soft spot in

securities

to limited

em¬

omission; securities do not. If this

be obtained from such of the undersigned

tions

tices which,

panel

dealers

and

things,

interest.

the

type, however,
the modus operandi is completely

tinue,

lack of

one

and

issues istration
type of -law

well

nished. In this respect they appear
to

that

seem

ploying this type would have been

Act

laws of the second

tion

act
best
designed to
safeguard and promote the public

assume

investment

been

attrac¬

upon

Securities

In such cases, moreover,

securities

provide

philosophy .harmonizes with

the

that Federal
as

number

would

and

security per se, and it is
interesting to observe how closely

a
community of view,
predicated on the safe assumption

legislation is to con¬
to the basic type of state

ap-i;

are

experience, laws of the type em¬
phasizing the registration of deal¬

unfor¬

tendency of

curity registration type, to

have

would

that

has

at the .very outset.

The securities industry and the

In-

tunate, aspect of the present situa¬

seemingly recognizes the
the
perpetration of a

fact

vestment Counsellors

Another,

losses

se¬

fectively safeguarded. It is equally
.important
that
no
unnecessary
our

used, such

under

the

greater under the other type
of law. In that event, however, it

reasonable

tive ventures of promise.
1 believe that, properly

two

Commissions Functioning

that
even

in and

otherwise in connection with their

way

and

proper

entirely

With this background it becomes

that, once a
license has
been general heading, and
issued, dealers have freedom ,of5

which
regulated,

upon

it is

are

compensation, espe¬
cially in the financing of specula¬

the

honor.

shall

elementary

of proper theme develop¬

t'orm,

what

know,

nevertheless

purpose

included

are

supervision ?pf dealer
profit margins and the promotion pertinent to inquire as to the rela¬
tive results obtained
under
the
of high standards .of commercial

books of ithe vari¬

Some of

is,

say

medium

recognize the existence of the Na¬ tion,

however,

interests

quately to reflect passage of the
Federal Securities Act, but they

basis

the

secu¬

rity registration type failed ade¬

In setting about to

business

our

,of

doubtless

you

kind

the

industry.

;

options

cumstances,
an
provide

securities

philosophies underlying
the drafting of "Blue Sky" laws

-the interests of

col¬

efforts

being made to
highly desirable ob¬

this

principal

our

event

tion.

There appear to have been two

modern

realistic

any

the

state

Two Underlying "Blue Sky"

uni-

.we

with

nature

very

laws

..and

administrators,

aware,

.only have laws of the

.among

estab¬

the

ulti-

lishment
such

probably

majority of the country's security
things the
dealers. This organization, estabr
average legislator is in no sense
qualified to deal with the proper fished under the provisions of the
type of legislation for a business Maloney Act, has broad policing
powers
over
its members and,
as complex and technical
as ours.
the

ssion,

for

that the ini¬

assumed

laboration

planted

-seed

I suggest

securities

•

will

believe

And if the need for action

urgent

must, be

ensuing

s c u

tiative and primary responsibility

out

without damage to the public

obtained,

are

currently

Not

result

it
be hoped

is to

you

jective.

uniformity and sim¬
that

cpn-

that, under the leadership of the

can

interest.

ex¬

complete

note,

are

provided

Fed¬

this

American Bar Association,

can,

for

would

practices and,

Act.

applications

part of underwriters' compen¬

options

Securities

that

that has not been the situation to

the

under the

sale

there

mean,

the fact

appropriate to the particular cir¬

necfion it is perhaps pertinent to

curities administrators to consider
the need

as a

eye

stock

economical

eral

laws to enforcement

plification,

where

tration of issues which have been

achieve

securities

which

States,

jaundiced

released for

of "Blue Sky" legislation.

industry
appreciate the opportunity to conduct an objective
appraisal of existing Blue Sky legislation. While

"it
*

in. the

law

mind

The

other things, permit the
or semi-automatic regis¬

among

field, and upholds IBA model "Blue
Says private placements of securities now require

broad revamping

securities

what

certain States look with at least

appropriate

obviously is the adoption of

uniform

comes

sation.
I definitely believe such
options, in amount and on terms

automatic

of integrity in securities

Sky" law.

tration

date

change.

streamline existing

state

shown to

fundamental

various

members of National Association of

counsellors. ;Stresses limitation of

of the

ideal

"paternalistic" regulation
objection to State commissions acting as investment

and voices

laws

this

Asserting ideal and objective of investment bankers is uniform
state "Blue Sky" legislation, Mr. Vrtis sees no need
tfor state
regulation of issues already registered with SEC, or licensing
Criticizes

case

State

particu¬

unnecessary,

has been

nition

Securities Dealers.

earlier

security registration type. Never¬
theless, comparatively little recog¬

Members, New York Stock Exchange
Chairman, IBA State Legislation Committee

are

the

in the

larly

Partner, Glore, Forgan .& Co.

of dealer-brokers who

much

made

Securities Act
By CHARLES

national basis for

on a

the first time and, in our opinion,

what'

page

The Commercial and Financial Chronicle

(1024)

the Materials Policy

asked

mission

Meeting the Thieat oi
Creeping Scarcities

how

President's Materials

Policy Commission's former head,

expansion of

plies with

ing demands, shrinking

Predicts

Since
and

this

time

sup¬

taking

tention

concentration

President
the

We
and

national

guide

choosing

are

missioners

But

cannot expand and con¬

increasing

war.

without

equally

may lead our country to
heights of growth and pros¬
perity.

populations

their needs and

satisfy

ample

right materials

and

desires—

flow

the

Our

the right cost.

strength,

sensational
production and con-

progress

our

In our stock-taking, we are de¬
bating among ourselves about the
best ways
of ending the Com¬

Sumption in the past, have been
attributable not only to the free¬

munist

enterprise of

threat

security

the

dom

and

world.

free

peace

institutions

our

to the fact that

the

and

people, but also
have had plen¬

.seeking the best formula for
building
with
our
friends
an

terials.

armed

able here at home.

are

might

gression
And

the

will

check,

breaks

war

that

hold

ag¬

out.

the creative,

way,

working out methods

chea^iv

with

for

not

and

moment

our

nomic

the

cope

striving to put the
new technology, the new
science,
to better use
to provide new
products and to improve the old.
bigger

growth

ma¬

and

ace.

the

question

this:

what

are

it in

put

the

to
will

extent

deed.

able to cope with the problems
the years ahead?

and

never

able to take advantage of the oo-

portunities; how well will

the

moral

pose

been

strated

material
so

seen

the

the live Communist

all

that

the

our

%An

which

address by Mr. Paley before the
Meeting of the National Industrial
Board, New York City, Sept.

the

serve

Problem.

whioh

333rd

of materials to

prospects—and

Materials

narrowness

the now dead Nazi
tyranny and has yet to know the
breadth

across

the

all

its escape from

cuts

problem,

has

values

when

The Vital Materials Problem
one

completely demon¬

today,

world has

interdependence

One

issue,

keeping

and

some

Our

material

resources

25 years

probably
four billion

the

it will

destroy

escape

The

one.

use

pre¬

choice over
struggle rages

very

world

today."
It

Conference

17, £052.

been

has

few

two

years,

H. Brown
tant

not an

offer

sell

lacking

months, since the President

or a

solicitation of

offer to

bay these securities. The offering is made only by the Offering Circular

per

"The

nature

the

almost all materials

and

rates

CHASE CHEMICAL
COMPANY

better

Institute

mand

and

you

going

demand

talk

ings

likely

because

felt it

take

was

Russel

DIgby 4-8040

Executive

but

WHitehall

3-0900

old

closely

that

mate

the

nation's

total

1938

The

held

dent

fice

State,

Trust

that

since

Presi¬

became

Franklin, which of¬
until 1950 when he

became Chairman of the Board of

Bank

for

York

New

Trustees of the

Chemical

Com¬

he held

bank, the position
his death.

the time of

of New York has promoted Mr. Cochran was a graduate of
Balaguer from Assistant Princeton
University where he
Manager
to
Manager and
ap¬ received the degree of A. B. cum
pany

After long
study and careful
calculations, we accepted the esti¬

Romeo

pro¬

pointed Frederick W. Thomas As¬ laude, with the Class of 1900. In
sistant
Manager
of its United 1901,
following
his
graduation
Nations Office, N. Baxter Jackson from college, Mr. Cochran entered
gross national product — would
announced on Sept. 15. The bank the employ of the American Loco¬
double by 1975.
This is in line
has
appointed
Robert
T. motive Co. in the Comptroller's
with the United States' economic also

duction

what

goods

the

based

was

and

services—

economist

growth of the

last
the

the

calls

100

population growtli to 193 mil¬
lion, a shortening of the work
week by about one-seventh, and
an
average
increase in produc¬
tivity of 2.5% a year.
lar of

Waldorf-Astoria Office at Lexing¬

ported

steadily
of

amount

goods

doubling of the

VV-

increasing

finished

until

ton Avenue and 49th Street.

materials cost has sup¬

raw

ma¬

for

came

all

ore.

Ingersoll Rand

has been elected

pany

Horace
of
of

appointed
ident

that

1950

Demand

would

mean

Credit

Department

Office,

French

became

the
at

Central

associated

Trust

Vice-President of Bankers

Company.

Trust
until

1929 until

From

Company
1937

was

Investment

from

and

net

for

timber will

be up

1937

and
of

1938

the

products—food
timber

represent

and

Committee.

was
-

director and member of

Finance. Committee

Continued

offer to

buy or sell securities.

page

Corporation

Common Stock
Price

$.30

per

increase

need for some

1,300,000,000 additional board feet

Continued

is made only by
undersigned

Prospectus, which may be obtained from
if registered in this state

ma¬

greater. But
the

page

GARDNER & COMPANY
50 Broad

Trust

Among his business affiliations

Kirk Uranium

Offering

1931

Vice-Chairman of

Vice-Chairman

was

Septem¬

This

Manufacturers

the

Mr. American Smelting! & Refining
with Co., and a director and member

Street.

Broad

Astor

remaining in that
1917 when he be¬

1931 he was President of Bankers

Main the

the

Vice-President

In 1912

business

Trust Company,

that the Board.

has been

Jr.,

banking

levels.

terials—will be 40%

would

Company

Assistant Vice-Pres¬

charge

the

10%, but demand for agri¬

for

President

announced

French,

came

Flanigan,

York,

& Cochran until 1912.

son

Trust

Suffern

1907 until 1910, and
a partner in Patter¬

capacity until

Manufacturers Trust
New

was

Co., he entered

director of the

from

then he

of New York.

possibly quadruple; demand
magnesium may reach 18 to

cultural

firm

that

with

was

in¬

short tons to at least 182 million.

onlv

;

Vice-

Corn Exchange Bank Trust Com¬

case

volume increase from 130 million

times

First

Demand for iron ore,

lead and zinc, will
only 40 to 50%; in the

iron

President

Charles

minerals

Lowry,

remaining-with
1907.

Sons, certified public account¬

ants,

.1'. * :

materials would in¬

We also set up working targets
the demand for separate cate--

Demand

■

Donald

gross

about 50 to 60%.

crease

•,
'

and

doubling of the demand for

mand for all

Assistant Manager of its office,

Snyder

years.

expectation of

even

Members of National Association of Securities Dealers, Inc.

Mendham,

been

continuously
In

date.

Committee¬

York

Bank

Board

County and

New

from

not

Nassau

National

Republican

present

fog of conjecture.

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

10, after a

having been elected a trus¬
in 1917 and serving on the

tee

far enough ahead to be lost in the

for

Street, New York 5, N. Y.

years

Board of
is County

its

Sprague

Mr. Sprague

man
—

Sprague

Directors.

far enough

beyond

year

estimates

our

conditions

emergency

Russel

about

We chose that

and that decade for

ahead

first

copper,

VICKERS BROTHERS

;

died at Plain-

had

Cochran

Mr.

the year 1975.

will

AIGELTINGER & CO.

.•

N. J., in 1879, he was 73 years
at his death.

Demand for bauxite for aluminum

52 Wall

associated with The Franklin Sav¬

crease

UNDERWRITERS

on Sept.
illness.
Born in

brief

some

The Likely 1975 Economic World

of
Investment Dealer

Banking

field, N. J.,

supply problem which

the group.

your own

than 40 years,

detail,

will be 90%
higher than
1950, with wide differences within

be obtained from
the undersigned.

School

Rutgers University.

kinds

graduate of New

of the American
Banking and of the

Graduate

face.

was

Henry J. Cochran, a banker for

give

Chapter

not

are

gories of materials and

Common Stock

may

with Public National Bank for 15

idea of the dimensions of the de¬

■V

Copies of the Offering Circular

thus

with these figures:.

per

Sept. 14, in this

Mr. Shirley was associated

York

CORPORATION)

$1.00

election

the

suddenly

city.
years.

terials.' We estimated that the de¬

Price

Sept.

attempt to define the

Materials Problem in

JERSEY

died

Company of New York announced

expanding

they may be doing,
similarly expanding."

perhaps

pressing harder and harder
against resources which, whatever

Shirley,
Assistant
The Public National

William

Cashier
*

Foreign

Sterling National Bank & Trust

problem,"

national product does not call for

291,000 Shares

NEW

Bank for 23 years.

Bank and Trust Co. of New York,

be successfully oversimplified by
saying that the consumption of

compound

with

ciated

Division.

ma¬

latter in¬
He was asso¬
The Public National
the

with

stitution until 1923.

Assis¬

the

remained

year.

report states, "can perhaps

our

services,

in New York,

Bank of Commerce

were ap¬

appointed

was

Treasurer

terials

Because, historically, each dol¬
'This advertisement is

Street, Jr.,

National

with The

merged

later

pointed Assistant Treasurers in
the Banking Division and Walter

are

from now, our
will require
tons

John L.

and

2,700,000,000

in 1897, which

U. S. in New York

Trust

Division; Louis Auer, V, Samuel S.
Marshall, III, Hoyt O. Perry, Jr.

with the drain—

economy

using

about

1950.

not

what

report

the Materials

excellent. But

want

amount

year:

I'm

Policy Commission:
ket at home. We want to explore
In defeating the Communist vio¬
the new possibilities abroad for
values will count
American capital and American lence, "moral
most, but they must be supported
trade.
by an ample materials base. In¬
The
prospects

tons

States

Depart¬

Personal

of 55 years,

span

widely known. Starting with
The Western National Bank of the
was

men¬

mar¬

ability

our

the Communist

over come

—

create

emphasize that there is

which, unless cap¬
ably handled, can create serious
handicaps—handicaps to our eco¬

are

We want to

every

Before

But I do want

terials problem

proud.

depre¬

and

people

problems.

our

keeping
our economy growing, and of fur¬
ther improving the standards of
living of which we are so justly
We

United

staggering

ma¬

easily avail¬

inventiveness

the

capacity

also

are

plenty

resources,

ciate

it is

because

American

The

Investment

the

ment

covered

reer

Assistant Vice-Presi¬
promoted to Vice-Presi¬

the

dent

Behind

Mr.

Jr.,

dent, was

else

it if

crush

Banking Division; Charles B.

Eddy,

of New York, died
the Mount Vernon Hospital on

Sept. 11. He was 69 years of age.
Murphy, whose banking ca¬

promoted to Vice-President in

the

wade

Bank

National

Public

The

Tryst Company

Edward

was

documenta¬

appointments:

Vice-President

Luke J. Murphy,

Palmer, Assistant Vice-President,

800,000 words.

some

new

full

its

Resources Falling

of
Our

and

peace

strength

for

the

ahead—years that undoubt¬
edly will be difficult but which

and

in April 1950.

and

assignment.

appointed

was

Assistant Secretary

York,
held
on
Sept.
16,
Charles J. Stewart, President, an¬
nounced the following promotions

got even—for to get our

and

1939

ber

the

New

had

the President had

over

rising

tinue to grow—we cannot provide

years

quite

that

meeting

Company of 100 Broadway,

Trust

wasn't

fellow com¬

realized

been handed

through five volumes comprising

Bankers

and

Board Directors of The New York

long-range

friends.

its

long before I and

economy

through

country

our

and

States

military

and

standard

the

Following

which

shortages

tion,

growth,

OFFICERS, ETC.

CAPITALIZATIONS

how

recommend

threaten

answer

is the foundation of

living

direct

party

government

and

BRANCHES

NEW

economic
which in

general

turn

NEW

REVISED

prime in¬

strength

usual

fundamental

strength is

gredient

at¬

our

than

Materials

year,

stock¬

all turning

are

with

problems.

election

CONSOLIDATIONS

the

and

growth and security of the United

soar¬

resources,

national

would

future,

overcoming

rising living standards and military security.

the

News About Banks

free

estimate

materials

might

rising real costs.

continued

the

private actions and public policies
could be directed toward averting

and consequent pressure
Calls for vigorous long-range indus¬
trial planning and international political action, to bring about
toward

asked

much

needs,

sum¬

materials' consumption outstripping

raw

possible domestic deficit of 20%.

Com¬

materials

adequacy of supplies to meet those

marizing its voluminous report, looking ahead to 1975 fore¬
sees

nations

needed

Commission

Chairman, President's Materials Policy

other

the

world.

Chairman of the Board, Columbia Broadcasting System, Inc.
Former

the

survey

position of the United States and

By WILLIAM S. PALEY*
and

18,1952

.-.Thursday, September

Street, New York, N. Y.

Telephone WHitehall 4-7313

Volume 176

Number 5152

;

The Commercial and Financial
Chronicle

(1025)

From

Prospects ior Free Power

Washington

Ahead

of the News

Discussing prospective rise in coal mining

weeks

before

the

Republican National Convention in
Chicago I expressed the fears of a quite influential
group that

the

defeat

Bob

election to the

Taft

for

the

nomination

Presidency of Eisenhower

and

the

subsequent
spell the end of

would

the

effective opposition which from 1939
on
has blocked the revolution in domestic
affairs
in this country. I
pointed out that insofar as
domestic affairs
were

concerned,

controls

„

is now
ot
Carlisle Bargeron

leadership,

harm any of

his

followers and

there

less likelihood of

even

accomplishment if he tried. This is not based
statement by Eisenhower
seeking to hold the party
together. It is based upon the simple facts of a
situation.
First, there is Eisenhower's realization that he can't
win
without Taft's support. On this there has
any

been

written

nonsense

the

newspapers.

can

that at

awful

lot

authoritatively

say

no time has Taft
had a stand-offish attitude. There
was
the slightest question that he
would support the Republi¬
can nominee.
He said this at
Chicago and he meant it. But it
stands to reason that to be most
effective in Eisenhower's
behalf,
Taft had to talk with
him, say to him, "Now I intend to say this
and that, will it embarrass
you?" If the General had said this or
that would have embarrassed
him, then Taft would have foregone
that speech but at the same time he
would have been less effective
in Eisenhower's behalf.
Certainly it was important that the two
men talk these
things over.

never

Also, Taft had been reading pro-Eisenhower editors and
syn¬
columnists, pro-Eisenhower only to the extent they can

dicated
have

that

their

own

and

way

get

Eisenhower

repudiate

this

they don't want in the Senate, that the General
planned,
to purge this or that Taft
supporter. It was important to Taft

man

the

assistance to

any

his supporters this

assure
as

was

nose

hower

who

wishers

The

Eisenhower, to be able

not to be the

was

It is

case.

simple

face and the professed well-wishers of Eisen¬
bemoaning his "sell-out" to Taft are not well-

your

are

all.

and

pure

simple

facts

that

are

Eisenhower

perhaps
They likely

conservative on domestic affairs than Taft.
won't have any trouble on that score. And
when Taft says that
their differences on foreign affairs are
mostly a matter of degree
he is telling the simple truth

notwithstanding that the trumped

pre-Chicago issue between them

that

was

"internationalist"

"global-minded"

and

Eisenhower

Taft

"isolationist"

but

international

affairs.

And

will

foreign front, it would be surprising to

doesn't

The

around

come

Taft's

Internationalists who put

over

Democratic

President.

What

these

Internationalists

realized is that the Southern Democrats will be
against
a Republican President does. In their

chanting this almost

much

public

any

number of Southern political leaders tell

excel

Truman

won

1940

would

who

was

The

Southerners

in this

have

ECA

relatives
a

MSA

have

does

demagoguery.
me

stories

have

the

li/r

utilities,

steamships,

and

source

though, will live
change. Atomic power

this

see

postpone World War III for

-may

°^e V ?f'
Lewiss

doubt if any readers

thjg coiumrij

Mr.

The dangers of using
appear now to make
impossible for any but very

power

For

atomic power

Ro»er W. Babson

gradually

instance,

ten

diminishing,

years

large

the

ago

was

output of bituminous coal
514,100,000 tons. While our

total
tion

national

industrial

has risen about

1941,

the

output

producthird since

coal

has

only about 4%. Yet every
"victory" by Mr. Lewis means an
the price

this

mean

Eastern

production.

J1A

This does not mean that
any investor should sell his coal securities.
Coal is very rich in vital

chemicals.
now

our

A hundred years from
descendants will wonder

...u..

why

permitted

coal

inson & Co.; and Wm. E. Pollock
& Co., Inc.

R. I.

«iUSG^

•

oper-

rays to operate irrigation pumps is
discovered, the deserfs

certainly will "blossom

rose."

Livingstoi

V.P. oi Walter Heller
CHICAGO, 111.—The election of
Robert

President

Livingston
and

ties

Middle

Western

election

would

nounced by Walter E.
Heller,
President. Assumption of his new
post will be effective Oct. 1.

Gravity Power

Mr.

writing this column while
important pharmaceutical prod- attending the Annual Conference
ucts.
The list includes hundreds of the Gravity Research Foundaof products from the clothes which tion at New
Boston, New Hampkeep us warm to the vitamins shire. Here are gathered scientists,
am

Livingston,

member

oil supply would be
exhausted in
about 30 years. But

today there

more
ever

proven

before.

discovered.

oil

available

New fields

yelous fields is the
in

field

are

One of the most

than

being
mar-

new Williston

the Dakotas

Western

and

Canada.

powers

the

was

boy, small water

the

were

power

source

then

most

used

the

mills of New England. In
my home
town of Gloucester, the corn was

have
wip
heat

will

differential whkh
turn
give us free power for our
a

farms

and

small

for our

greatly
crease

factories,

free

homes, and which will

reduce

the

cost

and

^™gstoin, 1generalcounsel for
asc ganrf a
° HirLtSQ

^a"7 Ay®fTrsnf

TTnl

the

doubts

ity,

just jump off the

to the force of gravroof

toe.

your

rRLpll Hnnlrins Pr>

(special to the financial chronicle)

COLUMBUS, Ga.—Cabell Hopkins is engaging in the securities
business from offices in the Columbus

Bank

Trust

of years.

offer to sell nor a solicitation of offers to buy
offering is made only by the Offering Circular.
are

offered

speculation

(A Delaware Corporation)

Common Stock

Price: $1.00
per

Copies of the Offering Circular
Investment Dealer

Israel &

Get

Over

are

Capitol Hill Oil Corporation

Europe;

played against the astute thinking Internationalists.

abroad, I think they

any

300,000 Shares

own

coming to realize this, too.

may

be obtained from

from the undersigned.

Company

UNDEF/ /RITER

111

Fnrmpd

Cabeil "Opkins L.O. formed

These Securities

your

1937.

Building

ten-story building! Or attempt to under the firm name of Cabell
walk up the Washington Monu- Hopkins & Co. He was
formerly
ment, or drop a window weight with Courts & Co. for a number

these securities. The

II.

tricks

versity of Chicago Law School

in-

safety of transportation
by highway and air. If you have

This advertisement is neither

boy

funniest

one

Jhe .*aw

since April of 1953
which keep us well
metallurgists, and mere "dream- ing the Heller Vice-Presidency, he
ers" like
myself, who are intersever his
connection with
Oil Outlook
ested in finding a partial insulator, the law firm which he joined
deflector, or absorber of gravity after graduation from the UmExperts once thought that the
waves
When this is done

members

the

E- Heller & Company, investment
bankers and factors of Chicago
and New York, has -befen an-

confidently.

States.

I have had

with

Vice-

member

general executive staff of Walter

practically

Street

en-

Associates of Halsey, Stuart &
Co. Inc. in the offering are: R. W.
Pressprich & Co.; Freeman & Co.;
The Illinois Co.; McMaster Hutch-

isnh£ng u*fd *y

sun's

dorsement by Erie RR. Co. They
will be secured by 24 new Diesel
switching locomotives, estimated
cosi; $3,600,000.

in southern Florida

ating factories of any kind. When
however, a method of harnessing

are un¬

principal and dividends by

before

in New England
u®"
rays'
where the sun is

®^
cases exist

be burned up. Already coal is
being used to make textiles, plas-

sending money to their European
and

Harvard

that

? ifn

valuable

Conant

suggests

freeholders

haven't

World War

barefoot, Wall

cultural

issued under

are

the Philadelphia Plan and
conditionally guaranteed

^sSnZu ^"hamessed^Al-

of coal and

pressure on

downward

University

in-

creased

increase in

users.

President

annual

global thinking.

Eisenhower's
ever

Republican President in and he can't look to the Southerners

to support his

won award of the issue

competitive sale Sept. 10

that had Wendell

have entered

into war," they have said

relatively

doesn't

not

crucified

trying to lead

sort

would

The group

The certificates

airplanes.

enjoy
they enjoy being "in"; and they

far

"Why,

Interstate Commerce Commission,

The Southerners

can

Willkie

almost
a

opposition, this

President will be "Wall Street controlled."

ma-

turity. Issuance of the certificates
wind- is subject to authorization of the

Then

magazine

written

if Eisen¬

Eisenhower's nomination

everything
,

priced to yield from

were

2.15% to 3.15%, according to

realistic

approach, have realized the General won't
have the majority support of his own
party, but they have counted
upon the Southern Democrats who have always
gone along on
the question of our intervention and
spending in Europe under
a

ficates

to prevent this realistic

„

Many

been

approach.
If he doesn't in the matter of continued
pouring out of billions,
TafKwill have the support not only of the
majority of his own
party but of the Southern Democrats as well.

power

only

restraining influence against Eisenhower in domestic affairs than
an obstructionist
against the furtherance of any Eisenhower for¬
eign program.
the

industry.

any

provided

equip¬

trust
certificates,
third
equipment trust of 1952, maturing
semi-annually March 15, 1953 to
Sept. 15, 1962, inclusive. The certi-

Atomic Power

im-

When I

any such conflict as this should come
up between them,
which, nowithstanding the propagandists, I doubt, an Eisenhower
Administration, in my opinion, is going to be a great disappoint¬
ment to the so-called Internationalists in
this country.
To my mind, if the Republicans should
win, Taft is going to
be the undisputed political leader in this
country in not

hower

which

tide-water

remember

mill, which has now been superseded by gasoline engines or elec-

heat.

"national" minded.

domestic

and

even

many years.

every reason in the world why his diehard
supporters
should, enthusiastically support the
Republican nominee. There
is no likelihood of
Eisenhower's seeking to purge
Taft, destroy

upon

can

every American farm had

power^ light

the Administration.

There) is

his

■

what

portant

wins, Taft will be the intellectual and
leader

two

and

offered

ment

effect that
atomic power will take the
place
because
his'of coal and oil in connection with
labor union '

powerful

■

the

This

gains.

spell the

most

substantial

leadership.
>
•
l \
;
Well sir, things seem to have turned com¬
pletely around. As it appears now, if Eisen¬
hower

his

nevertheless
he
will
get

it, and the fear

mills.

Inc.

11
serial

bid of 99.031%

group which I reflected was that his
defeat at Chicago and the nomination
and sub¬
sequent election of Eisenhower would
of this

ground

Sept.

$2,880,000 of 27/s%

the

end

then

pensions, and fringes for his coal windmill
miners.
Although he will curtail for one

enable

coal¬
ition of conservative
Republicans and Southern
Democrats had ruled Congress—on domestic
affairs.
This coalition was led
by Bob Taft,
he was the personification of
of

for John L.

come

Lewis to demand increased
wages,

demands

Roosevelt

associates

gravity.

The time has

some

lost the support of Congress after his
failure
of the purge
campaign; that since then a

Halsey, Stuart & Co.

Mr. Babson

wages,

calls attention to expanding use of other
sources of
energy.
Does not look for early application of atomic
power to replace
coal, but foresees some likelihood of harnessing

By CARLISLE BARGERON
Some

Halsey, Stuart Group
Offer Erie Equipments

By ROGER W. BABSON

national

Broadway

assw iation

securities

dealers

tat-New York 6, N. Y.

DIgbt 9-3481-5-6-7

Financial Chronicle

The Commercial and
13

Thursday, September 18,1952

...

(1026);
ferent countries who are

Surplus Countries Must Cooperate!
SALTER, T.C., K.C.B.*
Affairs

By SIR ARTHUR

responsibility for world¬
debtor coun¬
tries. Urges negotiations under aegis of International Monetary
Fund, for establishment of equilibrium in international trade
and payments. Endorses principle of "trade, not aid."
lying with creditor as well as

the general matter and deficit countries on the other
in¬ will be the most fruitful proce¬
It tends, in my view, to
ternal problem,
I think I may dure.
break up a problem which is es¬
justly say that there is important
sentially indivisible.
progress in the
There is, I suppose, much to be
United
King¬
said for a
confrontation of the
dom—that we

countries

deficit

governmental planning in an insulated economy must lead to
regimented poverty. Declares our new Administration must
open our market to foreign goods; end Western Europe's im¬
port quotas; and restore her currency convertibility.

pub¬

Coffin, Betz & Co. offered

Tuesday

108,000 shares of

(Sept. 16, 1956)
additional com¬
value ten cents,

the

budget last
March, after
having
long

losing our gold
and dollar re¬

contribution

the

serves

Electronics

It is

towards

estab¬

the

maintenance

and

lishment

tan

area.

tional

That is idea, the general idea, that I system in 300 homes during
a
very substantial progress.
We would ask this meeting to con¬ it is expected that feature
have
stopped the drain.
Itis sider and the Fund to consider Broadway shows and sports
will be televised.
much, but of course it is not when this meeting has finished.
I think probably everyone here
enough, and we fully realize that
The circular states that
the great part of our task is still would
accept
in
principle the event
that
Subscriber by my

commercial

into

comes

na-

unity

nomic

their

and

deal

of these

causes

turns

were

and their

Que

films,
events

„

Vision
the

Michael

Heilperin

reversed, in

shall

sure,

that

however,

right

need consultation with the sur¬

Fund is

well

two sides of the

process

tions
one

not

sure,

Fund

and

Sir

the

new

have

the

remarks

International

Monetary Fund, Mexico City, Sept. 4,'52.

announcement is under
of

these
any

for

securities.

these

made

only

sale,

The

means

solicitation

offer

the

these

offering

means

have the will to do to the

of our time what England did to
the world of a century ago: break
down trade barriers, establish a
stable international monetary systern, promote a steady flow of

foreign investments,
To be able to exercise

this

leadership, we in America have
to give up one of our most tradi-

tional attitudes in the field of
foreign economic relations. This
attitude, although it has long since
become obsolete in view of our
own growth and of our position in
the world economy, has still a

great many adherents throughout

Republic and to Alexander Hamilton's famous Report on Manufac-

avoid the temptation

our

old of one of the great turnings
of history. This I believe not so

the world has moved away from
protection and that from the mid-

and the research and en- much because of the clouds of war
gineering facilities of the Engel- which are hanging over us, clouds
hard companies. - This agreement which are not getting any lighter
also is expected to facilitate the because many of us turn our eyes

die 0f the 19th Century onwards
free trade was the prevalent "climate" of the world economy. A
protectionist nation, in a freetrade
world,
may' conceivably

extensive

offer

securities

and

plant

produc-

tioh facilities of the Hanovia com-

buy

pany

circular.

Skiatron

additional defense contracts
Armed Services, for

is currently

300,000 shares

has

Skiatron

tivated
,

Price $1.00 per

soon

the

has

field

now

the

given

expansion.

Branches

The reason why I think that our
destinies are about to take a major

turn is that I am convinced that
(he unity of the Western World is
light threatened from wittun, as much
as its security is threatened from
without, and because I believe
that the next months will show
Mgrs.
whether that all-important unity

York

New

CO.

10 Commerce Court,
Newark 2, N. J.

Stock

Exchange,

will

growing

stronger

weaker in the years that lie ahead.
The
imperalism

of the

Soviet

an¬

Union, the pernicious infiltration
of
communism,
these
are
the
1952, Louis A. Carr will become enemies whose power we must
destroy. In order to do so, we,
Manager of our Durham Office

nounced

that

effective

Sept.

15,

the nations of the free world, have

and

Wyatt A.

come

Manager

Salem Office.

our

Winston-

the

Dr. Heilperin before
Commonwealth
Club
of
California,

San

Francisco,

*An

address

Calif., Sept.

12,

1952.

benefits

from

protectionist

jn which our own
measures would have been
countered by foreign restrictions
against our trade,
or one

An Obsolete Policy
^

Firgt World War broke loose that

and

attitude

this

policy

was

obsolete.
When
the
United Staes emerged frcm World
becoming
War I

powerful
ism
to

one

of the world's most

economies,

history books.

back
In

the

protection¬

should have become confined

Instead, it came

virulent

than

ever;

1934, under the influence of
then Secretary of State, the

great
States

Armfield will be¬

some

It would not have de-

them

rjved

Reynolds & Co.,\ members of the

MOR AN

its tariff.

that the-

green

Reynolds Appoints
be obtained from the undersigned

our freedom.

television
,

derived

bave

without war, can undermine wordd
our society, our civilization, ana tariff

even

be ac-

may

enter

broadcasting
FCC

incorporated

Broadcasting Co.

This subsidiary

ELECTRIGLAS CORPORATION

much because of the great danger
of Communist influences which,

whom it

subsidiary, known

wholly-owned
the

large away from them in the hope that
from they will disappear, and not so

engaged.

Skiatron

solid

for the most tion, to try to appraise the exact
position we have reached along

offering

the

„

are

the land. It is an attitude which
goes back to the beginnings of the

can

to take stock

acquisition

may

foundations

world, the present

NEW ISSUE

Offering circular

Western

and

rules,

circumstances to be construed

securities

of the

endure

framed.

the
This

present situa-

bow

plications comprise,

problems

cohesion
is

a great
If the all-im¬

United States. We have the

part, entirely new conceptions in

is required for the

world,

surplus

Arthur's

Governors of

Its

unity and

prevent it.

the electronics field.
the road we are travelling and to tures. It looks upon a protectionist
perhaps will
An agreement was entered in+o make a guess, however hazardous, tariff policy
as a foundation of
It will, of
on
June
20, 1952 with Hanovia as to the course that is ahead American prosperity.
course, be found throughout that Chemical
&
Manufacturing Co. of us.
This protectionist outlook may
whatever the mechanisms, what¬
(Newark, N. J.), a unit of EngelDeliberately, I am yielding to —I say "may"—have been beneever the
rules, their success will hard Industries and the largest this temptation. I am doing so f icial to America's growth in the
depend very
largely
upon
the manufacturer of ultra-violet because my reading of eontempo- 19th Century. If it was, this was
spirit which animates all the dif¬
equipment for medical and home rary events leads me to the con- less due to the tariff itself than to
use and for industrial application,
elusion that our nation and the the fact that, under Great Britwhich makes available to Skiatron entire free world are on the thresh- ain's leadership, a large part of

that

individual

from

♦Excerpt
l»efore the

moreover,

the

ics.

of the modern

of separate consulta¬

between

hand

can

ultrason86 patents and patent ap-

radar, television and

make itself the kind of mechanism

persistent unbalance.
I

considering how far it
its policy, how far it

In the world as it exists today
there is only one power which can
conduct successfully a struggle
against economic nationalism: the

that

problem of

same

can

adapt

with the
-deficit countries. These are really
plus countries

the

their

make real advance in

never

and

leaders

their

di¬

through tionalism.

nations

whether

brief,

use,

eco¬

still

military and
political arrangements, one major
obstacle must be got out of the
way.
Its name is economic na-

public
honorable friend and col¬ company would plan to commence
acted
wisely
or
opinion
have
league, the Chancellor of the Ex¬ operations with a minimum of otherwise in the face of external
all this if all responsibility lies chequer, in his phrase "Trade, not 100.000
subscribers in the New forces and events.
with the deficit countries.
I do aid" as the future way of remov¬ York metropolitan area, with the
not suggest that the International ing
the
present
disequilibrium initial charge per show probably
Perspective Needed
Monetary Fund is given to such a with which we are confronted. being $1.00, the same price that
Contemporaries lack, of course,
-one-sided approach to this prob¬ Obviously, however, such a pur¬ the
company plans to charge dur- the
perspective from which alone
lem. Indeed, in several places in pose and a principle needs to be
ing the test. It is expected that the tideg of history can be propChapter I of the Annual Report, translated into a great deal of de¬ the company would receive all of
erl
appraised and fairly judged,
which strikes me as, on the whole, tailed action which I don't pro¬
th$ proceeds from its subscription An interpreter of the eontempoaccurate, impartial and sensible, pose to? discuss now, but which television and would be responsirary scene> be he a journaijst> a
the Fund has also mentioned the will, I suggest, need constant and
ble for the agreed-upon payments
commentat0r, a political analyst,
role which surplus countries have urgent and earnest consideration
to the producer or sponsor of the
Qr an economic counselor,
cannot
to play, while it has also stressed, over the months to come.
show, film or sporting event tele- dQ the WQrk^ which will only be
as the Managing Director did just
With all that, I do suggest this vised, as well as the cost of such
performed) years after he is gone,
now, the special tasks and duties closer
association
in
the
prob¬ televising.
by dispassionate and detached histhat rest upon deficit countries.
lems, in the way which I have
Skiatron, organized in Feb. 1948 torians. When living, however, in
The Fund's articles contain, pror proposed, between the surplus and
in New York, already holds an im- the midst of great changes and
vision, of course, for action in re¬ the deficit countries.
portant position in the electronics violent commotions, when facing
lation to countries which persist¬
I have only one last thing to industry by reason of its very val- an uncertain
future against the
ently run a surplus. I suggest that say and that is this. When the uable contributions in the fields
background of a troubled past,
I

solid
is

built underneath the

couldavoided
have
been

the

Western

by national policies which do

economic

political

however,

foundations.

World

cppllpnppc

has

by major economic barriers

portant

—

con-

and

edifice

little to promote

the

through the
Organiza¬

considerable

military

lacks,

vided

history,

what

which

Foundations

arrangements

now

The

cohesion.

better

degree

turns,

wnroP

and

Treaty

other

and

achieved

funda-

trade

ideal which was expressed

tion

have

mental

Atlantic

North

taken

The

they were back in March.

to come.

and

tries

tolerable

$300 million a
month, we

Economic

The Western World

)Yn.en of coun¬
llJe
tinies
tions

purposeful,

Needed

th^ have taken place, to ascertain

company, according to the
equilibrium in interna¬ offering circular, is now preparand payments, and
ing an application to the Federal
that is, as you will realize, why I Communications Commission
for
have main¬
Sir Arthur Salter
emphasized the character of our authorization to embark on this
tained those
with some fluctuations experience and method of work¬ public test in the scheduled de¬
reserves,
from month to month, substan¬ ing in EPU.
velopment of Subscriber-Vision.
tially almost exactly the same as
Well, that is really the main Plans call for a 90-day test of the

rate of $200 or

Sound

events, decades or centuries after

„

strong,

united.

historians,

•
•

of the jobs of

one

when they look back upon past

and

aegis of the international body, company to carry on a public test
its
pay-as-vou-see
television
the Fund, both deficit and surplus of
countries might agree on the steps system known las Subscriber-Vi¬
which each would take as their sion in the New York Metropoli¬

been

before

par

Skiatron

the

for a
period

stock,

might well follow from procedures
Television Corp. at $2.50 per share,
which are more in the nature of
Proceeds will be used by the
negotiations,
where, under the

results

maintains Western World's security

gravely threatened by internal disunity resulting from major
economic barriers and obsolete national policies.
Asserts

the date of the

Better

Adviser of Bristol-Myers Company, New York,

International economist,

surplus

forum.

and of the U. S. Council of the Intl. Chamber of Commerce

have, since

same

Economic

Stock at $2.50 a Stir.

mon

Unity

By MICHAEL A. HEILPERIN*

Skiatron Electronics

licly

as an

Obstacle to Free World

eignty.

and handling the

and

suc¬

domestic and national sover¬

own

In regard to

of inflation

work

organization

national

is much
more
prepared than it has often
been in the past to be really inter¬
national in its outlook and in the
consideration of its own policies
that lie within the sphere of its

Promineiif British official emphasizes
wide fiscal recovery

Economic Nationalism

inter¬

We shall never make any

cessfully unless each of us

State for Economic

Minister of

members

of these institutions.

trade

Cordell
entered

Hull,
upon

liberalization

Continued

the
a

United

of
adopting

course

by
on

page

Volume 176

Number 5152

The Commercial and Financial Chronicle

(1027)

ALL OF THESE SHARES HAVING BEEN
PUBLICLY

SOLD, THIS ADVERTISEMENT

APPEARS AS A MATTER OF RECORD ONLY.

These Securities

are

offered

speculation

300,000 Shares

Sunflower State Oil Co
(A Delaware Corporation)

Common Stock

The

financing of this issue has been arranged through the undersigned.

UNDERWRITER
MEMBERS

111

NATIONAL

Broadway

ASSOCIATION

SECURITIES

DEALERS

New York 6, I

DIgby 9-3184-5-6-7

The Commercial and Financial Chronicle

Thursday, September 18,1952

...

(1028)

No serious

Labrador.
made

Canada's New Horizons:
A Nation-Wide Survey
By HON. GEORGE

Connecticut Brevities

until

ore

After several attempts to

1936.

so, six of the largest United States
steel
companies linked up with

Rivet

Milford

Machine

Co.

has recently acquired Pacific
engineering enterprise
Rivet & Machine Company of Alto finance the project, including
hambra, Calif. The new addition,
building the railway I have men¬ which manufacturers tubular riv¬
tioned, extending from tidewater
ets, cold-headed specialties and
on the St. Lawrence to Knob Lake.
rivet-setting machines, brings to
I
understand that about
200
five the number of plants owned
miles of the railway will be com¬
by Milford Rivet & Machine.
pleted by the end of this year. The
♦
*
*
six United States companies along
The
annual
report of Locke
with Bethlehem Steel Corp. will
buy the Ungava iron ore at the Steel Chain Company shows that
rate of 10 million tons per year as sales for the year ended June 30,

Canadian

PRUDIIAM*
Technical Surveys

Minister of Mines and

Canadian

attempt was

this

develop

Canada's economic and industrial progress,
additions to his country's
industrial facilities. Describes extent of Labrador's new iron
After reviewing

Canadian cabinet officer lists recent

deposits and the new petroleum developments in Northwest
Canada. Says Canadians are proud of their recent financial
achievements, and lauds defense program. Sees Canada, with
its resources and enegetic people, a great hope to humanity.

soon

production and transpor¬

tation is in full swing.

1952,

The

fiscal

the

report of North &

year

indicates

1952,

somewhat

off about 3% to $3,Earnings per share were

were

667,000.

annual

Judd Manufacturing Company for

ended June 30,
that sales were
the level

below

year

earlier.

Earnings were reported
equal to $3.51 a share compared
to $4.28. Substantial plant expan¬
sion

modernization

and

ried

was

car¬

out

during
the
year
to
strengthen the company's position
against foreign and domestic com¬
petition. The modernization pro¬
gram
will continue in coming
years.
sj:

Sc.

steep Rock, Ontario, north equal to $2.21 against $2.97 the
Even today
On Aug. 29 Connecticut Power
r
,
.
old.
agriculture holds a dominant po- of Lake Superior, a large lake has previous year. The balance sheet Company started to supply nat¬
oped untold possibilities. Its ten sition in our economy. For ex- been drained and 70 million tons shows a change in book value of ural gas to the customers in Tor¬
provinces stretch across six Stand- ample, Alberta has 100,000 farms, 0£ tbe ja^e bed removed in a the common from $16.96 to $17.58 rington.
The gas is purchased
a r d
Time with a total annual value of pro- f0Ur-year dredging operation in a share, and an increase in cash from Northeastern Gas Transmis¬
zones
and, duction exceeding $800 million, order to get at the rich iron ore from $226,000 to $537,000 largely sion. Both Northeastern and Al¬
due to a decrease in receivables
among the na- compared to the present annual deposited underneath,
gonquin
Gas
Transmission
are
tions
of
the Alberta petroleum production,
projects such as Knob Lake and and an increase in the tax re- building lines across the state to
world, it cov- valued at $116 million.
But steep Rock will be well served by serve,
provide service to additional areas.
ers
the
third throughout
Canada^ todayisthe ag- the proposed St. Lawrence Sea*
*
*
whpn
\
largest
land ricultural industry
is being way> when fhifi +rpmpnrlni,« ,mbeing
this tremendous unAt the annual meeting on Sept.23
are a.
Only strongly challenged by manufac- dertaking is completed, both nav- stockholders of Marlin - Rockwell
Bankers Offer Farmer
China
and turing activity and by the other igation and commerce will benefit Corporation will vote on a propo¬
S/
%
•a",
a

agricultural.

largely

nation only 85 years
Yet in that time it has devel-

Canada is

#
'

wav

<mV

Russia

are

larger.

industries.

primary

Can¬

ada's

transformation

the

from

Great Lakes system

New Industrial

Canada's

tremen-

into

the sal

of
a

North

the

increase

amount

Sub- to

Mediterranean.

American

common

authorized

Bros. Co. Securities

from 400,000

shares. If approved,
P. W. Brooks & Co. Inc. headed
dous
farm
stantial blocks of hydro-electric the company will effect a four- a group which yesterday (Sept. 17)
The industrial facilities we now
production, its
p0Wer will also result from the for-one split by issuing three ad¬ offered
100,000 shares of 6% cu¬
forest
wealth possess, based on the harvest
seaway
development.
Canadians ditional shares for each - share mulative convertible first pre¬
and its treas- field, forest, mine and stream, turn would have greatly preferred the owned of record Sept. 23.
There ferred stock at par ($10 per share)
Facilities

of ura- out each year in Canada over $15 £u|j and active cooperation of the are presently 339,245 shares out¬
nickel, billion worth of processed goods, united States on the St. Lawrence standing.
It is planned to retire
petroleum, natural The economic transformation of project. Since this has not been an additional 24,900 shares of
ures

George Prudham

nium,

gold,

copper,

coal, iron, magnesium, titan-

gas,

ium, asbestos and its rapidly
mounting aluminum production,
will do much to help shape the
of the

future

world.
strength

real

the

But

this

in the
trade

country Will not be found

story told in its year books,

reports or catalogues of progress
Great though its natural resources
may be,
Canadian nation represents, above all else, qualities
of mind and heart that can never

thl

thyatC

adorned.

into

being

ing opened up in Ontario,
Canada, on its own if necessary,

Confederation

Canadian

This
came

as an

experiment

18 undertaking the deepening
P°wer development of the

It began as a
vision in the minds of statesmen
in this land and its peo-

saw

maffprs
matters

in
in

of
01

governgovern-

ment, the best features of British
institutions

narliamentarv

and

p.
1?T
y institutions and 01
the Federal
i

system of admmistradeveloned
in
the
United

tion
ot

Jlp,
It

was

those
was

western

this

davs

Voltaire

Canada'lightly
"a few

today
to

countrv

largely unknown, even to Ca-

nadians

bold undertaking.

we are

see

describing

snow"

acres

dismissed

once

Even

occasionally' startled

American summer visitors

arriving with skis and snowshoes
strapped to their cars
But in
earlier

days

responsible

even

in London, England,
could only see in British Columbia what they described as "a sea
of mountains unfit for anything."
newspapers

to
w

ra.dway
e,is
J)ei^g1 b"llt 11nto Manitoba s north,
A

the

portant
600

influx

miles

tional

provinces

two

north

gional developments in somewhat

will pardon

for pointing out

border

into

people

the

the empire

of all this development is being accomplished by private enterprise

larger than Vermont with government assistance.
was
taken up in homesteads in
I have just quickly sketched in
1909; an area twice that of. Con- what is happening in this country

1910,

than DelaHampshire com-

from

bined in 1911; nearly the area of
Maryland in 1912 and more than

ture.

ware

the

and

area

New

of Massachusetts in 1913.

first

this

development

was

.he'Ai».e°it:roVc"mVr™trm,bse.!:"
Banff, Alberta, Sept. 3, 1952.

Bridgeport Brass Company has

inaugurated a voluntary employee
stock purchase plan which will

Farmer

1912

shares of

stock.

common

Bros

Co.,

organized in

in 1923, is
primarily in processing
selling coffee direct to hotels,
and incorporated

engaged

and

permit
used

on a

sion

and

its

plains and

for then- determined optimism,
Recent discoveries are providing
something more than dreams and
anticipation as a basis for their
characteristic hope and confidence,

When one considers the situation in all its aspects, it may not
be far from the mark to say that
Alberta possesses the world's largest pool of energy supply. With
an audience such as this I do not
need to dwell on Alberta's position
in the matter of petroleum and
natural gas. In the short space of
five years this province has become one of the world's major oil
producing areas,
Oil

continues

found

which
of

shortage of materials
a decrease in sales

caused

the

Cycle Division. With the
aid of new plant facilities at the

Torrington Broad Street Plant and
at South Bend, Ind., sales of the
Bearings Division reached a rec¬
ord level.
During the past two

the company has spent ap¬
proximately
$6,000,000 on new
plant and equipment. To provide

in 1951.

eler

for this

increased

Co.

Angeles,
Co. of

years

funds

members of

Other

the

under¬

writing group are Dempsey-Tegof St. Louis and Los

and Baker,

Simonds &

Detroit.

Robert Eaton Opens

coast

one

would like

the

other.

to fill in the pic..

The
As

now

Labrador Iron Deposits

early

1893

one

our

Fed-

portef thl'Sistenc^oT'iron

ore
deposits in the Ungava Region of

apart.

expansion and for is engaging in a securities business

inventories

arrange¬

ments have been made to borrow

from
He

offices at

was

624 Erie Avenue.

formerly with Penington.

$4,000,000 through a 10-year loan. Colket & Co.

The pattern of these dis-

coveries indicates the existence of
an

extensive belt of territory cap-

CHAS. W. SCRANTON & CO.
Members New York Stock

Exchange

able of producing oil and natural
gas in quantities that will go far
to meet the fuel needs of the free

world. Gas, estimated in trillions
of cubic feet, will prove to be a
powerful magnet to industry.
But all this is only

fringe of

our

touching the

possibilities in the

Continued under "Canadian
Securities" on
page

RENOVO, Pa.—Robert E. Eaton

spread signed policy to give breadth and Western and Northwestern Candepth to Canada. I may add that ada at points at least 1,000 miles

area

necticut in

ferred stock and 164,654

interna-

the Peace River.
An

cer¬

combined to make

will have a capacity output, when
completed, of over 1 billion lbs. of
aluminum per year
the, Yukon Territory new
r°ads and power plants are being
budt to serve the important minmg districts of the far north.

Al- that all this progress and advanceberta and Saskatchewan. This im- ment is part of a carefully debeing

taking

remaps some or you may nave

into

tion of Manitoba and brought into

With the mighty Rockies

the greater detail. But first I wish to
present century a swelling tide of say this.
What I have outlined
people from all over the world are not just accidental, unrelated
swept into Western Canada. This happenings. Speaking as a memhuman flood doubled the popula- ber of the Federal Cabinet you
early years

that

all

work.

used to purchase from

its

railways

changed the entire picthe

tain principal stockholders 98,625
shares of outstanding second pre¬

tends to produce the same

soon

pany's sales are derived from de¬

heard the clubman>s definition of

land
ture.

payroll deductions to be
regular instalment basis restaurants and institutional users
rne r.ynn ijdKe area.
Fneland
an
island
snrronndnd to buy the
company's common in seven Western States. Through¬
Uranium City has come into ^ngiana — an island surrounded stock. The maximum amount de¬ out this 40-year period the com¬
: t
:
Northern Saskatche- by three parts water and one part
existence in i\ormern basKatcne
j
Alhprta
has a
difforont ducted cannot exceed 10% of sal¬ pany has never operated at a loss.
wan and 1S growing rapidly.
scotcn. Alberta nas a ditterent ary or wages.
Through a subsidiary manufactur¬
Over 3,000 oil wells are produc- ly.Pe °f geography to that but
*
*
*
ing coffee urns, the company also
ing « capable of producing, and a
i
presently
manufactures compo¬
The
Torrington Company re¬
number of extensive natural gas
nent parts for jet airplane engines*.
ported net earnings of $2.37 a
have be™ discovered in.on
Net sales for 1951 totaled $13,Alberta and a 700-mile oil pipe- western flank, this province share for its fiscal year ended
June 30, 1950, compared to $3.55 157,653 and net income was $256,line from Edmonton to Vancouver spreads
great
935.
Sales for the first half of
1S under construction.
parkland. Climate and altitude a year earlier. The decrease was 1952 were at a record high and
largely due to the world-wide
The tremendous new aluminum have
for an en- textile depression which resulted net income of $148,906 was ahead
enterprise in British Columbia ergetic, enthusiastic people, noted
in lower sales of the Needle Divi¬ of the figure for the same period
p

to help develop nickel deposits in

and

summarize
OUj

At the present

about one-third of the com¬

fense

place.

I am sure that you would want
the attraction of homestead me to deal with these various reconstruction

The

time

Coming now to Alberta, it is
exceedingly difficult to know how

$2.37 Vz

The

stock.

of during this year.

Oil

Canadian

and
St.

Lawrence Seaway.

pie the prospect of a great and
happy country, one that would incornorate
corporate,

50,000 shares of common stock

gimPp0rtanti

nation building.

who

and

per share
of Farmer
Bros. Co., a California corpora¬
annual re¬ tion.
this country is truly national in forthcoming as hoped, Canada will
r
scope. The Maritimes, as we call bave an opportunity to test its port for the year ended June 30,
The first preferred stock is con¬
our provinces on the Atlantic Sea- own financial and engineering 1952, shows that earnings on the
vertible at par into common stock
board—the vast prairie region-— muscles on one of the world's common were $6.78 a share, after
of the company at an initial con¬
the Precambrian Shield and the foremost challenges to human in- Federal income taxes at a rate of version price of
$2.50 per share,
Far North—all have taken on a genuity, planning and enterprise, about 67%.
and is subject to redemption at
♦
*
*
newmeaning and significance in
Can
hag for
the
option of the company or
recent years.
dnreH hpfwppn 80% and 90% of
Pitney - Bowes, Inc., estimates
through the operation of a sinking
that it will save about 42% on the
fund at $10.50 per share.
„,Hn1 he
world's nickel and the new
dustnes are springing into life , vnn r
apvplnnmpnt will hpln manufacturing cost of 90 oilless
Over half of the proceeds of
and a great causeway across, the
bushings and 20 structural parts for
the offering will be added to
Canso Straibhas beer'
its postage meters through instal¬
-n
The
Construction <* a 3M-m le rail- uranl
finds at Beaverlodge in lation of three single-punch pow¬ working capital to provide for
the company's growing volume of
way is steadily_ pushing up into
caoirafnV,«™rar,
v,„in
iron
ore^or^ern Saskatchewan will help er metal presses. An additional business, the remaining proceeds
the Labrador-Quebec
maintain Canada's place as one of 12 structural parts will be added

treasury

weighed or measured. Without
recognition of these intangibles,
Canada cannot be fully or truly region.
\the world's foremost sources
understood.
Great new iron deposits are be- that
highly strategic metal.
be

1,500,000

New Haven

New York

—

REctor 2-9377

Hartford 7-2669

Teletype NH 194

Volume 176

Number 5152

The Commercial and Financial Chronicle

(1029)

W. Emlen Roosevelt
The

Roosevelt

Inc.

;W.

ST.

Emlen

PETERSBURG, Fla. —Ed¬

Charles
of
In¬ mund
Darbois, former
Company,' Floridan, has recently joined the

President

Management

has

York

Florida Sees. Co.

Managem't

election

vestors

thur Warner

E. G. Darbois With

Pres. Inv.
'

been

announced.

staff

mund

Jr.,

Ed-

Brown,

who

Florida

Securities

pany, local investment

succeeds

offices

the

Com¬

house, with

Florida

National

re
i

Bank

Building. He will become
Manager of the Research and
Advisory Department, as well as
being a registered representative
of the company.
Mr. Darbois has

background

of 25 years diversified Wall Street

experience, including key
tive posts

& Co., Inc., of New
City. Prior affiliations were

Manager

the

Investment

Smith-Douglass Notes
Placed

Advisory Department for Sulzbacher, Granger & Company and
Bendix, Luitweiler & Company,

phosphate rock to manufacturers
of poultry and animal feed. It has

Privately

of the New York Stock Exchange.
Mr. Darbois is a graduate of the
American Institute of

$6,000,000 of 37/a% notes

York

City,

both

members

Banking

due Sept.

execu¬

Mansfield

School

Emlen

Roosevelt

The

Staff,

leading Wall

Son,

old investment firm,

year

man

the

Board

Management

proceeds

will

used

Smith-Douglass Co., Inc. of

was

Assistant to the

Vice-President

In¬

than 98% of the

outstanding stock

vestments

has

Trust

grade rock in Florida and supplies

well

Bank

Edu¬

Company, New York City.

Coronet Phosphate

extensive

155-

Chair¬

Inc.

and

Chairman of Long Island Transit
Authority.
W. Emlen Roosevelt
was

formerly

velt

Son

partner

partner of Roose¬

and

also

Dick

formerly

Merle-Smith.

Investors

Management Company,
Inc., established in 1925, is one of
the

oldest

research

organizations

specializing in the management of
open-end investment companies.
Investors
Management
Com¬

Inc.

pany,
ments

Inc.

the

manages

invest¬

Fundamental

and

Investors,
Management

Investors

Fund, Inc. which have combined
resources in excess of

$150,000,000.
Company,

Investors

Management

Inc.

the

and

Hugh

moved

affiliated

Long

their

York to Elizabeth

firm

Co.

offices

The

from

New

because of the

with

finance

management

Funds

for

1797,

Roosevelt, a
Roosevelt,
partnership
of
Son,
which has

and

carried

from

generation for
The

years.

Mutual
decades.

the

Roosevelt

Theodore

established

three

almost

James

forebear

been

for

century and with invest¬

ment

of Roosevelt has been

name

associated
than

recently I

city's action doubling the tax
financial businesses.

generation
than

Roosevelt

firm's

155

pio¬

neering efforts included the early

financing of railroads
communication
C.

the

Roosevelt

founders

Bank

1824.-

Roosevelt

and

cable

this continent.

was

the

one

Members

family

Chemical

were

the

actively

associated with the earlier found¬

ing of the Bank of New York
of them

one

was

and

liip;

its second Presi¬

dent.
'

1924, under the "sponsorship
&
Son,
Investors

Roosevelt

Management

Company

was

formed

to specialize in research
and Investment
management.
Soon thereafter, one of the earliest
modern investment
companies was
launched. This is now known as

Investment

Management

Fund,

Inc.
In 1939 the

company undertook
investment management activities
for t Fundamental
Investors, Inc.
At

that

the

Fund's

08M

assets

million

and

Investors

largest mutual invest¬

ment

funds

total

net

$135

the

than

$10
Fundamental

today
one

time

less

were

the

assets

country, with
of

than

million.,

Edward Jones to Admit
Grosse to

Partnership

ST.

LOUIS,

Grosse

will

Mo.—Hamilton

become

partner in

Nature's

Edward D. Jones & Co., 300 North
Fourth
New

Street,

York

Exchanges,

members

and
on

Midwest

Oct. 1.

of
.<■

Stock

Mr. Grosse

has been with the firm for
time.

the

some

unhurried goodness

has

opened

offices at

the

securities

(Special to The Financial Chronicle)

prior thereto
Executive

Investors

Company,

Turner

Maplewood Avenue to engage

connection with the acquisition by

Roosevelt

art
69

cational Director for the Lawyers

Research Director for J. Ar¬

Opens

PENNS GROVE, N. J.—J. Stew¬

post-graduate

Graduate

ling.

His most recent connection

J. S. Turner

•

1, 1967 with the Equitable Life
business.^ Mr.
of the
Assurance Society of the United Turner was previously with Laird,
Banking for
Bissell & Meeds and
Reynolds &
Bank Officers, Rutgers
University, States and John Hancock Mutual Co.
the first graduating class of 1937. Life Insurance Co. A
sinking fund
Formerly he was Instructor in is to commerce on
Joins Edgerton, Wykoff
Sept. 1, 1956.
Banking
and. Investments
for

well

Street Investment Counsellors and

coupling Banking, Bro¬

two plants in Florida.

Smith-Douglass Co., Inc., with
executive offices at
Norfolk, Va.,
have placed
privately through F.
Eberstadt & Co. Inc; an issue

New

kerage and Investment Counsel¬

was

s ■I
Schenley's

unmatched skill
f

The best-tasting
whiskies in ages

Co., which

reserves

high

LOS
P.

ANGELES, Calif.—Thelma

Furey

with

has

become

affiliated

Edgerton, Wykoff & Co., 618
Spring Street. Miss Furey
previously with Hannaford &

South
was

Talbot

ties

and

Co.

Pacific

Coast

Securi¬

The Commercial and Financial Chronicle

...

Thursday, September

18,1952

(1030)

Worldwide Devices to Help
The Saver

and void. The other

ing to eliminate the consequences
of

STAHL

the worldwide

daily fluctuating value of money
or

Concludes all such devices are ineffective in dealing
root injury to savers from inflation, which he sees as
pro-Communist "Fifth Column."
is

today
wyxa

universally

professionals
problem which

and

—

today,

a boom for the manufac- Fifth Column, realizing in the and debtors get confused, the
of calculating machines but midst of an increasing dearth the process of production, the saving
increased, the income of the public would be in an un- hopelessness of his saving activity, becomes a gamble and a lottery."

copper

the

for

the

A.,

but

entire

the

for

world

econ-

of in-

omy

im-

estimable

accepted in Australia where from
time to time in various States and

middle of

period

which

cities a "basic wage" is fixed. This
basic wage is the official minimum wage which, on the ground

pro-

duction

is in-

creasing

of the respective standard cost of
living, is considered to be suf-

un-

precedented-

ly,

decline

the
money

occurring

cannot

brought to

con-

will reduce the value of
by 50% within 15 years,

money

This

purchasing power of money which
might
affect his actual wages,
Professor Slichter, U. S. A., rec-

halt and

if this process of devaluation

tinues,

receiving wages are protected against fluctuations of the
person

that

means

the interest of the
emission
of
bonds
"escalate" in return with
in

ommends

the

savers

which

saving of 1,000

Swiss francs at 3% interest would

inflation.

within

proposed that railroad
made flexible.

this

family,

workman's

In this manner the interests of the

value

which

for

ficient

even

Switzerland
Charles R. Stahl

in-

fixing wages according to the respective price index has also been

portance.
the

automatically

workmen

creased, too. The workmen participated in the gain. On the other
hand, they also had to accept a
reduction of their wages in case
of a price decline.
This idea of

not

only

itself would be questionable. The general introduction of
the Index Clause would certainly

period

nominally be
increased to approximately 1 560
(assuming that the interest' is

likewise

result in

has

been

tariffs be

favorable position with respect to
the daily functions of life. Just
imagine the housewife in the
butcher shop with the index table

nnnf{nup^ jrom

vane

Continued jrom page

Fighting inflation
regulation, complications
and red tape; the economy would
be in the hands of index commissions, and their setup, and the
technique of calculation would be
the source of endless conflicts.
It is essential to remove inflation itself—not its consequences,
The difficulties are caused by a
variety of causes. For instance,
while in the U. S. from December,
1945 to June, 1950 the wholesale
price index increased by 50% and
wages increased even more than
the costs of living, the quantity of
money increased by only 8%.
Here, the price rise was caused
by the civil demand which had
been suppressed during five years
of war. The Korea boom — the
typical war boom—had the same
price-stimulating consequences,
Inflation does not necessarily
mean an increase of the currency
in circulation. The same results
may be obtained by speeding up
the circulation of currency and by
expanding the volume of credits
The decisive function of saving
in tier hands!

means

Significant Gains to the Nation
Resulting From the Steel Strike
to be bound by any
_

laws covering

else.
The previous November, the
Regional Director of the United
Steelworkers in Buffalo—Joseph
P. Molony—said boldly and publicly: "We aren't going to pierce

the wage stabilization formula,
we're not going to bend it, we're
going to break it."
With a Wage Stabilization Board

•
m-

W9e

p«

motive

saving

face

standstill,

tablish

the phenomenon that
millions of savers, not realthe
importance
of
this

lzing

process of

devaluation,
at

money

The

rate.

are

negative

the

and

Clause.

Index

investment

the

Whereas

„

inn.

the

danger of

pansion

than

inflation,

credits

any

would—even

increase of the
interest rate—be hampered by the

1935

1933

effect

increased

costs

and

ation,

President Truman scrupu-

One would have endangered.
therefore, that the govIt seemed to the steel comhave agreed with panies, therefore, that this issue
40
the original position of the steel should be brought to a head. Once
is: Savings industry—namely, that there be and for all the principle of in-

1950

ernment

would

comfortable inflation": risk of having to repay a much
The equation still
tevauatl0n 10QoQm0ney in higher pominal amount, and this
xxix*x*ov*.r—**«xxxW,
— mm mx mi
\*/ac*en 3^e
1939 and 1951 would in ato constructive manner plus taxes=private investments no wage increase and no price in- dividual freedom
was:
contribute
dam
_____

■nor

inflation.

Switzerland.

39.5%
41.6

{Sweden

43.7

Great Britain

48.5

Holland

61.5

Belgium

74.8

are

inflation,
insurance
holders
particularly affected because

Brazil

76.3

the

France

94.6

their

Italy

98.1

their liquidity. Recognizing this,
the
Karlsruher
Lebensversi-

Japan

means

Swiss

saver

had Fr.

that

who before the

amount

years—an

(figured

the

est

3%)

rate

but

this

his

war

1 468 60

inter-

disposalequal

purchasing value of only Fr 880
his Fr 1 000 not
only has brought no gain for the

In other words,

but

saver,

nearly

the

same

to 18%

moreover

tually suffered

12%.

has

ac-

substantial loss

Such

loss

under

conditions has amounted

in Sweden and to 22% in

that

schemes

remove

are

dangerous effects.

and

disposition

the

difficulty of

Already in the

The

....

price
,.

of
,

particularly subject to

r*?ong fluctuations.

The wages of

taking
and

vents

supply

are

invest-

only possible by

savings.
increased

banknotes inasmuch

from

demand ^by

the purchasing power,

away

regulates

ments which
means

those

are

regulates

Saving

pre-

circulation
as

the capital

savings, at least in

normal

means at

most $3 a ton under the Capehart
Bill.
But the government disagreed completely with this viewpoint. There seemed to be little
interest on the part of Washington in holding down wages and
prices and so prevent further inflation and stabilize the economy,
As a result, we couldn't bargain,

x**-

union

position taken by the steel industry met with almost universal approval. I have looked at scores of

editorials. I have listened to hours
0f radio and television. Except in
those cases where the writer or

out-and-out
there was apsteel companies'

the speaker was an

labor proponent,

proval

of ;the

position/ ,

it seems to me that again what

call the rank and file was
aroused to a great danger. They

hoped that the industry would
It had hold to the position it had taken
and see the fight to a conclusion. .
that if So there we have a fourth gain
cratic social order is the democ- the Union and the companies had from the steel controversy. We
ratization of the capital distribu-. been permitted to carry on nego- have set a pattern for solving the
tion. While in the year 1929 the tiations without governmental in- question of the Union Shop,
5% of the highest incomes in the terference much of the huge loss
Lastly, there was the clear unU. S. A. still included 34% of the brought about by the steel strike masking of the alliance between
total national income, the dis- rwould^ bave bfen aY01(;e5r
government and organized labor. ■.
tribution change in the/ year
So I hope that out of the steel
There, had been rumblings of
1944 to surh
deerep
in thi
controversy we will. get a third such an alliance but too few

to the amount of the insured
value.

Aside

from

the

fact

a degree that in this galn That gain wlli be that rn peopie took the rumblings sen% of the highest incomes the future the Union and com- ously. I think that the speech
included but 18% of the public parif'will be able to sit down to- which President Truman made

year

completely insufficient, the prob-

mining industry, the

introduced.

copper was

either

system of the "sliding wage scale"
was

economy

that the reserve thus created is income. The taxation of maximum

inflation itself or, at least, its most

copper

means

danger

coun-

in various

last century, at first in the Amerlean

long-term

the

the insurance companies. These
surPlus funds are intended to be
distributed not in the form of
service increases, reductions of
pr(:mium, participation in the
Sain, etc., but shall serve as a
money-devaluation reserve. In-

real

order

face

from

domination should be settled,
The interesting thing is that the

is a widely known usage in the- gers* the middle classes of so- demands would be met.
insurance business to let the in- ciety. One of the most important n0 minimum demands.
sured participate in the surplus of factors of progress in our demo- f I am firmly convinced

who

couldn't give or take, because
Insurance Company of Karlsruhe) the disposal of the State.
the government held the high
is now endeavoring to exclude the
'J-■ * - cards and we held the, low ones,
risk of money devaluation by esThe Insured Middle Class
The ; Union expected that, with
tablishing a plan of Index-Gain.
The money devaluation endan- government support, its maximum

tries

those

cherungs-Gesellschaft A. G. (Life times, places sufficient

Anti-Inflation Steps Not New
wonder

litical

surance payments in case of death
may be made from
this reserve

Great Britain.

being proposed

Insurance

sponge:

after 13

compound

would

sum

Fr.

tlelp for
Holders

if, for instance

1,000, has today

fects of
Further

„

99.3

This

The ef- creases, though the steel industry
saving behavior in a po- was entitled to an increase of al-

plus public expenditures.

South Africa

in most

it was interesting mat i most,
steel situ-

thought,

1943

stayed with it to the that
end.
Tt was interesting

stable economy.

1940

companies refused to make of
themselves recruiting agents for
the Union.
We have seen tooduring of our
many recent
nhridgpd
freedoms abridged miring recent
decades to look lightly thisa point
on
further abridgment Soon
tner aoriogment. so on mis point
the companies set their course and

prices, and prices lously neglected to mention the
also were government controlled. Union Shop. He talked about the
One of the functions of the gov- economic issues but never about
ernment should be to maintain a the human freedoms which were

50%

1930

ex-

consider

their

1920

of choice from their employees. If
an employee wished to join the
Union, that was well and goodthat was his business. But the

ment controlled because they had of his discussions of the
to

(—I99) as follows:

the

interest
of

connection between bank

vajue changed since 1913

cUrve

depositor would be insured against

invest-

and

war

deposits

following figures show

results

the

today

many

ing

capable, that they would combat
force their employees to join the Union as the
price of working in the steel mill,
The Union was insistent that it
would settle on no other basis
than a complete Union Shop. And
there the matter stood for weeks,
Some people perhaps wondered
why the steel industry held to its
point so steadfastly. The answer
every effort to

set up exactly in accord with the
desires of Union leadership, it was is simple. The companies believed
inevitable that Mr. Murray would sincerely and honestly that they
not engage in any real wage bar- had no right to take the freedom

our

—•

the very beginning the

From

stabilization—that they were steel companies announced, with
going to get their demands ... or all the force of which they were

wage

gaining with the steel industry.
That in itself would not have
compounded); but, calculated in
A Finnish Proposal
made an altogether impossible
francs
of
today's
purchasing
Professor
Bruno ■Suviranta
of
situation. What did make the
power, would actually be worth Helsinnfors sueeests the introduc
whole controversy hopeless of setonly Fr. 780, that is, half of Fr
Uon of
Index ClauL whiS
tlement was the fact that we had
1,560. Insurance premiums pen- similar^ to the Gold Sause which
a third party at the bargaining
sions
mortgages
whniU sys- simiJar make the value dependent
to tne Gold Clause which
valuation of monev table. The* third party was the
sions, mortgages—our whole
would
wmi it trie valuation or money
■ u
J
tern of credits—is endangered for
the sold nrice—would make*'Fe dependent
on psychological government.
lone time to come. w Lmol
fimc tn
°
Jit, value ofc. stocks of factors. The value of. the dollar* In the steel negotiations the
long
Whereas in the nominal
:au,<?fs\ Tbe value
dollar* g0^rn ®nt was an active prothe classic
national
economy
a
fixed interest, etc., dependent on lrt the past several '/decades watf government was an active pro
constant decrease of the interest the respective prevailing cost of sub.iect to changes almost as in- Ponent on the side of labor
The
rate hplnw 2% was considered
J. e. respective It is interesting of clslve as tne develonmpnt of tne companies couldn't were governprevailing cost to .
talk freely
below
living index.
development of the
wages which
tolerable, as it would bring the note that ho also intonds to
rate of speculative securities. Its aD0Ul waps wnicn were govern
noie inai ne also intends to esrate

the "rate ~of turers

which^oncerns'"everybody-'labor] tation"oT^copper^if*
management,

practice. Sooner
entire function of

the

later,

money

the miners were tied to the quo-

problem

carrying

would be put into

years.

Inflation

underesti-

seem

difficulties* of

the

through these projects in practice,
It is difficult to imagine how a

of monetary de¬

course

preciation, cites the escalator and other ameliorative arrange¬
ments which have been tried in Europe over the past hundred
with

inflation,

mate

Economic News Agency, Inc.

Swiss economist, tracing

projects which

by flexible Index Clauses are try-

Against Inflation

By CHARLES R.

erably the formation of capital In the end, such a development
within wide circles of the popula- could only be profitable for a
tion.
,
communistic propaganda. In this
The social downward trend of connection, Lenin's words, which
the middle class endangers our had already been cited by Keynes,
social order. The small saver con- should be remembered: "The best
siders himself cheated by the de- way to destroy capitalism is the
valuation of money. The small deterioration of the currency. By
man whose only hope in the trou- means of inflation, the State can
bles of his daily life is a quiet, confiscate large parts of the pubcarefree evening of life, sees the lie capital. Its consequences, howbasis
of his
old-age pension ever, are not equally divided. Not
diminish more and more. The fear only the safety but also the conof old age, this central motive of fidence in a just distribution of
his saving, drives him more and the capital disappear. The relamore
under the influence of a tions between people, creditors

possible, would require premiums
to be so high that the purpose of
the insurance would become null

incomes

the USA

was

in-

§ether and bargain collectively to when he announced the seizure of
a conclusion in an uncontrolled, the steel industry did more to con-

lem cannot be solved thoroughly rrea(?Gd fn tup la„x oc vparc uv on economy—no wage fixing, no price vince people of this alliance than
in thls manner. All means of the ^reased *n the laat 3^5 years by
fixing—but with the natural laws
°Ser °nG
t'u a
■
insurance companies would have times. Rising production increased Ilxing Dul ^ *
4
ur
+ih
6 WaS
m
1° be invested "inflation-proof"; the real income. From 1945 to
supply and demand settling the pe0pie's minds, the talks made by
or—just as risks are reinsured— 1951 alone, wages in the U. S. A. issuesVice-President Barkley and Sec-

;^pCx^pfnnc1Ga themselves against
^increased
able to reinsure

by 120%, while costs of
Question of Union Shop
retary of Labor Tobin at the CIO
The fourth gain has to do with convention in Philadelphia gave
by only 80%. All these
This, however, if at all factors are apt to further consid- the Union Shop.
them ample confirmation. It was

devaluation

amounts

the

insurance

living

rose

Volume 176

Number 5152

The Commercial and Financial Chronicle

(1031)
at this convention that Vice-Presi¬
dent

Barkley told 3,000 delegates
hoped the Union would

that

out of the

come

dispute with vic¬
tory. And Secretary of Labor Tobin on the same platform told the
Union members he

with them

was

"heart and soul." "I don't feel any
obligation to be
impartial," he
added.

"The only way to settle
this dispute is through the accep¬
tance of the recommendations of
of the

Wage Stabilization Board."

Stalements
not

such

these

could

even

skep¬

help but convince

tics

that

had

the

Federal government

aligned

shoulder

itself

with

shoulder-to-

the

United

Steel-

workers of America.
There

tion

still

was

this

Truman

alliance.

indica¬

President

refused

steelworkers
and

steel

resumed.

return

denounced

atti¬

deterrent to

political understandings of
this type.
These five points
efits
this

which

have

are some

ben¬

out

serious labor controversy.

grown

economic terms it has been vastly
expensive. But there has been a
great

gain

There is

public

education.

really free education.

Everything we learn we must
for, whether with money, or
If I

ter

labor

management

had in

the

any

not

are

They

desire

transient

part

are

break

recognize that unions
organizations.

our

economic

system.

But they must become a
responsible part of that system.
Now let me make one sugges¬

tion to accomplish this.
The first point I made

talk

this

that Congress in its next

was

session

will

action

undoubtedly
which

pos¬

bet¬

have

will

fight

their

the

strength and

will

very

think

must

take

lead

limit

means.

that

equally aggressive. We must show

country

expanding, growing econ¬
economy in which there

untold

tunities

sensible, responsible

company

perfect

there will

unrealized oppor¬
Until

automobile

our

has

homes.

built,

constructed,

new

methods

will

new

developed

reach

the

unions

build

We will not

better
mature

are

one

him

the

use

excessive power

bor unions

place in

can

our

At
est

the

use

With

gether

derstand
there is

the

his veto.

The

real

for

the

Presi¬

unwillingness to utilize the

Taft-Hartley Law
talk made

Act

Used

reason

Indiana,

revealed in

was

June 22,

at Gary,
Murray, the

Philip

Union President. Mr.
Murray told
his audience:
"I
remember dis¬

tinctly just about the day before

Christmas, 1951, President Truman
communicated with

and in the

national interest he suggested that
the original strike scheduled for

January 1 be postponed. He at that
time

said

'If

voluntarily
of

the

have

ing

willingly

you

agree

and

suspension

strike, I believe

need

you

fear of the courts impos¬

membership the

upon your

called

Taft-Hartley

so-

injunction

process.'"
No
labor
leader, as far as I
know, had ever previously
planned his strike strategy in close

consultation with the national Ad¬

ministration.
I

convinced

dent and Mr.
nite

for

reason

both the Presi¬

Murray had
not

defi¬

wanting

the

Taft-Hartley Law used. One of its
provisions, as you know, is that
the

employees

offer made

the

vote

by the

the

last

company. Both

President

and
Mr.
Murray
well have been afraid of the

may

outcome of that vote.

dare

the

take

men

the

mouths

They didn't
of letting
themselves as in¬

chance

express

dividuals

and

of the

not

through

Union

the

heads.

So here again was a dramatic
example of government-union
strategy. It was entirely appropri¬
ate for union leader

Treasurer David

—

Secretary-

McDonald

—

publicly refer to the President

the

"friendly

White House"
the

gentleman
whose

steelworkers
"a

called

the

attitude put

into

what

particularly

fortunate

position."
At

Union

Convention

Philadelphia Mr. McDonald
mended
more

President

day,"

Wages

certainly

are

said,

"in

pleased

the

steelworkers

dispute, since labor did

role
the
so

to¬

was

undoubtedly

shocking

for the country to realize that the
Federal Administration would

operate with

are

good, with regular,

co¬

ex¬

costs

progres¬

paid by the

company.
1

The work is

phone

men

and

women were

interesting, with

promoted to

Telephone people have found respect
opportunity in the business. They've

and

found

pleasant associates and fair play;

significantly, about

<p
•,

for instance, more than 45,000 Bell Tele¬

higher jobs.

complete Benefit and

Pension Plan with all

wage

1948."

th^eir

that the telephone

is "a good place to work."

sion raises. There is

that

well by

Mr. Truman at the polls in

over many years

company

even

Harry Truman is playing in behalf
of

Telephone people know from

perience

com¬

Truman

warmly.

"We

the

many

ppportunities for advancement. Last

year,

new

employees

one out

every

is recommended

present

employee.

BELL

TELEPHONE

four

union organization
the nation as a
With this object lesson be¬
a

at the expense of

whole.
fore

it,

the

general

look with greater
of

future

public

care on

government-labor

will

evidence
rela¬

other's

height

use a law which
had not only been passed by Con¬
gress but passed by Congress over

dent's

take their proper

willingness to

each

Taft-Hartley

that la¬

willingness to work to-'

and

Taft-Hartley Law.

Was not

standing.

willingness to

Why

im¬

speed that cooperation and under-

time did he show the slight¬

Labor

most

society will tend to,

Law and rejected his demand for
seizure
legislation. But he still

didn't

the

curbing la-

bor's

industry and its executives. He
urged Congress to suggest methods
for settling the .strike.
Congress
told

portant groups in our modern
way
of life.
I think that

instead.

scolded

reached

heights we
have
cooperation, under¬
standing and mutual responsibil¬
ity on the part of all the impor¬

seizure

and

have

new

must

Until the perfect

been
and

models devel¬

new

oped annually.

tion

Representatives in Congress What

and

for the individual.

home

We must tell

economy,

omy—an
are

economy until
perfection.

tant groups of the
country.

country—a
possibili¬

President Roosevelt once
said,

but

materials

whole.

helping this

great

of tremendous
It is not a mature

na¬

this

doing
helping ourselves

country
ties.

more.

have

that labor monopolies are not bad

we think it.
them to take

will be

even

for industry alone but for the

long since past when

why

will be

—yes—but

the

industry's side must be

and

encourage

courageous, positive action
controversial
subject.
In

some

past.

The time is

curbing labor monopolies. This is
an issue on which the labor unions

relation-,
we

the remotest

union.

ex¬

right in the assumptions

made, we may
sibly look forward to a much

pay

perience.
which I have

has

bet

seizure

threats of

questioning
as

their

production

resorted

and

This

tude may serve

ship in the future than

another

consistently to
utilize
the
Taft-Hartley
Law
which would have permitted the

jobs

tionships.
future

SYSTEM

un¬

problems,

we cannot reach.

The Commercial and Financial Chronicle.;; Thursday, September
18,1952

(1032)

"Difficult Decade"

C. L Felske V.-P.
Our

ef Kalamazee Co.
Mich.

KALAMAZOO,

—

Reporter

Ap¬

Governments

Harry G. Serlis, President of Schenley Distributors, Inc.,

Vegetable
Parch ment

count

shrinking luxury^
dollars, high taxes, bootlegging and inventories as factors
putting "squeeze" on industry.

kept on the money markets, when the
Treasury announced it would refinance the Oct. 1 maturity of
1%% certificates with a 14-month 2Vs% note, which will mature
on Dec. 1, 1953.
As a result of the announcement, the market is
again adjusting its position to the new financing, which may bring
in its wake, changes in the prime bank rate as well as the redis¬

The

Board

the

of Directors of
Kala

m a z o o

Company.
will

assume

about Oct.

ciated

past

banking

in-

Longford Felske

Chicago,
of
which he is now a

Vice-President.
Formerly Secretary of the Invest¬
ment Bankers Association
of
America, he is a graduate of Cor¬
nell University and served during
the U. S. Navy,

World War II with

of lieutenant

rank

the

reaching

commander.

Reynolds & Go. Places

which

close of the New York

made a sec¬
ondary offering of 100,000 shares
of
common
stock
(par $10)
of
change on Sept. 15,

Union Telegraph

with

cents per

quickly

per

discount

dealer's

books

$39

fixed 5 price

Co.

at
90

Western Union stock as a perma¬

investment.

Edw. Luckett Joins

and

Curb

ated with them.

become

New

Harry

wholesaler

supplier,

the

years

the

with¬

inven¬

threatens

the

in¬

Schenley organiza¬
revealed, recog¬

Serlis

difficult selling pe¬
lead to the com¬

of the

ahead

has

inauguration

pany's
^

training program for

re-

Mr.

nition
riod

sales

new

bers 0£ the sales staff and

variety of quality prqd-

and has

ucts to sell will survive and pros-

gram

tSSS

the in-

dustry must reorient its planning

mema

con¬

stern

Continued

prohighly

reservoir

"It is our conviction," he added,
"that

the

quality of personnel—

in other words,

tion—will

Economics

(1)

within the company.

following four

the

staff and

experienced managerial talent"

operations to "increasingly
competition" because of the

"squeeze"

field

'<* promotion to higher posts

and its

provide both

«to

skilled

tomorrow s

if he is alert to

per

—

the

the human

equa¬

decisive

factor

the

industry during the next

decade."

from page 15

Objectives in State
Securities Act Legislation
_

'legfsTaUonS ™

modern securities legislation. It modern, securities legislation and,
was
prepared with due regard to
the fact that we, in our business,

Of lasting vajue mddelact displayed by certain of
the confidence, your member ; administrators. I
goodwill of our customers and should like 16 leave this additional
public we seek to. serve, and thought-with you. I-don I*-know

unless

issue, it would have resulted
15, 1953, being followed almost

and

immediately by another sizable

the

1953.

out of

one on the first of September,
something that the Treasury would most likely be
interested in avoiding.
V •:;
:"

This is

have been encouraged by the
support of, and interest in, the
we

nothing

possess

had been used to refund the Oct. 1
in the very large maturity on Aug.

Mr. Luckett will

consumption,

tainer who furnishes true value tinuing on-the-job training
a

expected.

notes

associ¬

Within

Sept 15

Ex¬

has in
out

spirits and

regular customer of

situation

tion,

added:

"defeatist discussion," and
The

legal

dustry's financial stability.

stressed that his remarks were not

rather widely

for

consumer

means

forced

with production and unless
eight-year bonding period is

tory

Serlis

City on
Sept. 11, Mr. Serlis declared that
for all elements of the trade "the
future holds stern competition for
the available business."
But he

coming in September when the $7,986,000,000 of the 2% of
come due, to be followed by the present issue of 14-month *
which mature on Dec. 1. If the Aug. 15, 1953 certificates

one

President and Treasurer of United

has

the

York

result of the current refunding, the 1953 maturities in the
latter part of the year will be spread out a bit more with a large

changes, have announced that Ed¬
ward H. Luckett, formerly ViceCorporation,

ence

extended

confer¬

Heavy Maturity Schedule in 1953

Co., 1 Wall St.,
New York City, members of the
Stock

pace

manage¬

ment

been

whiskey from the in¬
dustry's inventories have not kept

y's
a

alcohol.

drawals

The industry
must compete for the consumer's
luxury dollars, which are shrink-

S. Smithers &

York

cline

factors:

F. S. Smithers Go.

New

field

maturing 1%% October certificates. This exchange offer con¬
to put a modest amount more of pressure upon a tight
money market, which is going to be kept tight as long as the loan
trend and the inflationary forces appear to be in the ascendency.
The new 14-month note should be well taken and, with Federal
the holder of some $7 billion of the maturing Oct. 1 certificates,
there does not appear to be any problem in the handling of the
$10,861,000,000 of the 1%% certificates that come due the first of
next month. By extending the maturity out to Dec. 1, 1953 there
will be a spacing of maturities which would not have been the case
if the Aug. 15, 1953 issue of 2% certificates had been used in meet¬
ing the October maturity.

proceeds from the sale
of this stock will go to John Fox,
who will retain 81,200 shares of

e-d

tax-inflated

(4) Inventories—Due to the de¬

tinues

closed.

The investment banking firm

p a n

r e

steadily

constantly growing traffic in

bootleg

the

share. The offering was
oversubscribed and the

The net

nent

t h

is the usual case, gave the market a mild
surprise when it offered the 14-month 2ys% note in exchange for
Treasury,

o m

market

the

modest

cases

has become

Schenley

"package deal"

into rather significant prominence about a week

came

The

share,
of

was

the

opening

session

This
was supposed to be a three-way offer, reportedly consisting of a
3-months maturity, the reopening of the Aug. 15 2% certificates
and a 14 or 14y2-month 2V8% obligation. Holders of the maturing
Oct. 1 certificates, according to the rumors, were to be given the
option of taking any one of the three maturities or a part of each,
according to their needs and requirements.

Co., following the
Stock Ex¬

Reynolds &

The next deal that

before the announcement by the Treasury was

address

The

—

(3) Bootlegging—The

many

the

Taxes

of small

the

price of legal liquor has caused

cannot

conditions

continued decline in consumption.

pressure."

talked about and touted around was the so-called

Western Union Shares

Western

alone

under

(2)

dif¬

increases

markets if it had been used.

decade"

Surprise

ing

;

rising living costs.

"during which
p o p u lation

14-month 2ys% note to take care
maturity of l7/s% certificates did not come entirely
as
a surprise to the money
markets. There had been the usual
amount of uncertainty in the market that generally accompanies
the waiting period when a refunding operation is at hand. Added
to this, however, were the effects upon the market of the many
opinions as to what the Treasury would do in meeting the Oct. 1
issue of l7/s% certificates.
The belief was rather widespread for
a time that the Treasury would reopen the Aug.
15 issue of 2%
certificates, and in this way provide for the October maturity.
This would have meant a 10 %-month 2% obligation, which would
have put a minor bit more of pressure on the money markets.
Next came the reports that a one-year maturity bearing 2Vs%
would be used by the Treasury in the impending refunding. This
would have put considerably more pressure upon the money

firm
Hall
C.

Entirely

Treasury's offering of

The

of the Oct.

Company,

mainly to the

least

selling

relieve

Not

vestment
of Harris,

Harry G. Serlis,
Schenley
Distrib-

d i t ions

c o n

operations by the Treasury. The longer market is thin and
definitely on the uncertain side because buyers are inclined to
wait for more favorable conditions before they will put impor¬
tant funds to work in these securities.

years

the

with

continues to get the bulk of the

the

for

"at

ficult

new

has been asso¬

utors, Inc., the beverage industry
faces

despite the modest firming in rates, due

demand

15.

Felske

Mr.

According
President

rate.

The short end of the list still

duties

his

was

pressure

says

for all elements of the trade the future holds stern
competi¬
tion for available business. Cites consumer's

By JOHN T. CHIPPENDALE, JR.

pointment of C. Longford FelsKe
as
Vice-President in charge
of
Finance
has been
announced

Facing Deverage Industry!

possess

realization that confidence

what percentage of the country*

goodwill, in turn;: are devel* ' securities business is transacted by
oped and retained only through high-grade and:thoroughly repuand

member of the firm's invest¬

table firms but, if the membership
stand-the*NASD*in relation to:the
ards of commercial honor. This is* total/number of firms operating m
^Tely anoSiCTTOy otsatfngthat;*the;iountryvis any criterion, the
the preparation of this model percentage must be a high one.the rendition of

Tight Money Policy Believed Temporary

ment department.

ice

Although the terms for the handling of the October certifi-

Ihere

signs of an

are

immediate release of this pressure, there is
apparently no change
in the

•

satisfactory serv-

and adherence to high

opinions^of most money market followers that this is atoJhi i&Cpur^ses^Ofsdiscussidn let's
act, we strove diligently to in¬

U. S. TREASURY

fuZr^is wel"a??ha?higheerSst
+ VlO

cniml

ZnoTprefenl''

rates

■

corporate fair and equitable

v '

prin-r.
hrin^trarily

« is

with the

STATE
and

-r

Federal

J-AAXU

has maae gams by its tight
money
initiative for the creation of these reserves is

MUNICIPAL

*11

UiG

W1ULU

policy, because the
•

back with the

now

Federal Reserve Banks.

If business should start to taper off, and
will in future months, the tight money conditions1
immediately to easy money conditions. Federal
fears inflation, but it hates deflation worse than the devil does
holy water. •
.,V.
many believe it
will give way

SECURITIES
*

• •

...

Chase Gheitlical

Sloclf
unase Uliemicai OIOCK

^ould hke to suggest to you «

dealers and the substantial licensW feet?
Our
ing fees..Our answers franklv to
answers

toda^ /
+vL
SimanlY to deal With the issues dlS-

any

^anKiy^io

.objectors

ranks

agency
_

certain of its provisions, such as
the frequency of supervision of-

that

may
_

of supervision;as.

VllGICU

Brothers
lation"

Aubrey G. Lanston
& Co. :
ST., NEW YORK 5

WHitehall 3-1200
231 So, La Salle St.

45 Milk

CHICAGO 4
ST 2-9490

vnaie

offering "as

are

a specu-

issue of

common

Chase

stock

291,000 shares
(par 10 cents)

Chemical Co.

at $1

per

share.-

INCORPORATED

15 BROAD

Aigeltinger & Co. and Yickers

St.

The net proceeds will be added
to the corporation's general funds
and

used

es-

HA 6-6463

The company
laws of New

the
as

the

successor

1942

to the business of

law

the
t

type

;

dealers accounting
of the busi-

nessTbe point is, however, that
^ endeavoring

to reach this small

minority, 'unwarranted

shackles,

'^horou^^^ep^SSS

;' / the business. Maybe that emphasis
was justified in some prior period

we
.

♦

Unestnut btreet, Newark, N.J. ule of fees, it contemplates pro- statutory requirements, all regis-

Opens Offices

Gabriel

viding revenues sufficient to sup- tered dealers^^ are^^ competent and

Arc*

/v
•

PaD

encasing

port an adequate, examining and Honest but, being realistic and unsapervisory staff, a factor of real fjerstanding of the frailties of

^business from offices at
Jersey

model

propose admittedly requires rntel- but, under present and prospective
SoPharmacal Co.
propose admittedly re.
.J1*1® corporation is engaged in ligent supervision^ but in this re- conditions, we feel it is definitely
hie manufacture, distribution and spect it would appear to impose misplaced. The notification type ot
sal® ofy-.-^hrmaceutical,..Vviteinin <no-greater administrative burden ac£ effectively remedies this basic
and household medicinal products.; than results under existing Blue defect in concept. In effect it starts
.Tne corporation leases its -prmj;..gky laws.^^Furthermore, through out with the assumption that, upon
of'
locate^ -the imposition of a proper sched- regigtratioh and tcompliance with

working
capital in connection with financ-

BOSTON 9
)

the corporation, under the 'name '

additional

ing increased inventories and

a partnership .organized in. 1929 high standards of conduct ai$ that
by
< Cbas-l^a Itout fee is a small price to pay

(Iff fir All aI 11« QLama nian,r the principal stockholders of for good government.
:

effec? designed pri?

S^tho^ehikifiing^5%

tl^ administrative

be . expected'to pro-?

a minimum

■,

today are' in

157 West 85th Street, New York
City.

—human nature, it goes on to say in

already indicated, we sin^
cerely believe that an act of the

substance that all hell will break
loose if a dealer subsequently

Jfolume 176 "Number 5152

...The Commercial and Financial Chronicle

(1033)
himself otherwise.

proves

type of bill which, while simple
in form and construction, has as
many, if not more,
than most statutes

in it

"teeth"
the

books

moment

to di¬

today.
r

Allow

for

gress and to go

back to

earlier
statement about the fringe ele¬
ment in our business. It is there,
I admit, but I sincerely believe we
my

have less of it today than
other

business

in any

know

anything
about. Please pardon the personal
reference, but earlier this summer
I spent a little time in the Colo¬
rado Rockies with my

did

fair

climbing.

amount

Even

family and

mountain

the

highest
peaks I noticed growing and flour¬
ishing some of the most beautiful
flowers

have

ever

despite

seen,

their obvious necessity at that al¬
of combating all sorts of

titude

conditions and elements. The

attrition

our

business, both in

dealer firms and in manpower.

many

Finally, I suggest that a broad
revamping of our Blue Sky legis¬
lation structure is required if we
are to deal
intelligently and effec¬
tively with private placements of
securities.
It
is
unnecessary
for me to
point out the tremendous amount

where

cases

would

have

been

corporation

better

curities in the conventional

to be upward. I

that

there

are

this

basis,

es¬

personally believe
situations

where

private placements have a proper
place and can readily be justified.
Having said that, however, I want
in

the

breath

say

that,

entirely apart from

any

social im¬

plications I believe

very

definitely

the

that

scales

for

continue

be,

many,

certainty, though, that

agements

the

The

Financial

lyer has

become

Rodman

209

Hickey

City, members

New York and

A. H;

Chronicle)

associated

Linn,

with of

South

Bryant, Jr., Dir.

Samuel

Lock

Metzger, Jr., President

Thread

announced

Corporation, has

the

election

mum

delay. As a result, if the Salle Street, members of the New Hager
Bryant,
toward private placements York
and
Midwest
Stock
Ex¬ Mr.

trend

is to be arrested

reversed it is

imperative that there be removed

ing in the

way

of distributing

Bryant,

changes.

Mr.

viously with
&

Co.

and

Hellyer
Francis

Merrill

was

pre¬

Pont

jr.

partner

director,

Carey, Joost & Patrick, members
of the New York Stock

Lynch, Pierce,

was

Fenner & Beane.

se¬

ol!

Philadelphia-

Baltimore Stock
Exchanges.

CHICAGO, 111.—Arthur B. Hel-

very

Thomas

way, New York

man¬

cost conscious
and,
furthermore, interested in
getting the job done with a mini¬
are

admitted to
partnership
in J. W. Sparks &
Co., 50 Broad¬

With Rodman & Linn
(Special

Oct.

will

are

thing has been overdone and promptly all unnecessary obstacles
there have been, and will and impediments presently stand¬

probably

Thomas J. Hickey la
Be Partner in
Sparks

ner, that is via the public offering
actually have fared method. And it is
perhaps un¬
better, if it resorted instead to a necessary to point out to you
that,
public distribution. There are, I regardless of what
may happen
know, usually a variety of consid¬ to others, the coffers of the several
erations behind
the decision of states
will, through the medium
management to go down the pri¬ of registration fees now
being lost,
vate
placement route, and it is benefit from
any such shift in
conjectural to what extent the method of distribution.

tipped in that direction
pecially in recent years, and to the by the expense and difficulty of
fact that the trend appears still blue-skying securities. I do know
of business done

man¬

advised,

would

and

SfflP

con¬

Exchange,

formerly President

national Safety Razor

of Inter-

Corporation,

clusion

was inescapable that con¬
buffeting about and strug¬

stant

gling for existence had only served
to enhance the
beauty and fra¬
of

grance

tions.

these

the

marvellous

best

characteristics

crea¬

elements

and

developed

are

this manner, then I submit to you
that we today must be of

necessity
perfection,
nigh unto twenty

paragons of virtue and

since

for

well

garb has been

years our

strait-

jacket and our diet has been a
highly restricted one. The period
has been
the

difficult

one but,
flowers, this

of the

case

very

fact and condition has resulted in

development and progression
might otherwise not have
taken place or at least not to the
a

that

same

degree. We have learned
lessons we are not likely to
forget and, most importantly to

many

my mind, there has developed a
tremendously keen appreciation of
social duty and
responsibility as

reflected, for example, in highly
'developed
tional

and

energized educa¬
public relations pro¬

and

grams.
Securities Business Is Highly

Competitive

Getting back
vje

the track again,

interested in enactment of

are

modern

securities

legislation be¬

INTERNATIONAL MINERALS & CHEMICAL CORPORATION

cause, quite frankly, we feel it is
•essential and necessary in our in¬
terest

well

in the public in¬

terest. Our business

over

the years

has developed into a highly com¬

T'.

petitive one, with all that that
implies, and I believe that the rec¬
ord to date in the pending anti¬
trust suit against. the 17 invest¬

:•
'

SUMMARY

1952

RESULTS

•

Veoi Ended June 30

1951

Y-eor Ended June 30
'

ment banking, firms is replete with
evidence to hear out this conten¬

tion. As

result

we are

Net Sates.

•

$84,570,447

•..

$66,257,884

extremely

•conscious of .our costs and

do¬

are

ing

operations

Earnings Before Income Taxes.

Income Taxes

$ 3,025,000

9,678,251,

;

•

$ 9,639,130

everythihg possible to place

our

the most effi¬

cient basis

possible? It is true that
the past several years have been
active ones; yet mere activity is
not always synonymous with pro¬

Net

operations. Last year, for
example,-was a year of great vollime
but,rbecause .of inventory
losses absorbed in. the first

$ 3,125,000

Percent Income Taxes to Earnings Before Income Taxes.....

fitable

32.42%

$ 6,653,251

Earnings for the Year

Percent Net

31.26% '

$ 6,514,130

7.87%

Earnings to Sales.

9.83%
'

■

Earnings Per Share of Common Stock Outstanding June 30..... .$

half,

it appearS.that the results for the
entire year of many firms left a

Dividends Paid

great deal to be desired. Those, on
the other hand, that last year, and

Common Stock.......................

•

Per Share of Common Stock

this year, managed to do
reasonably well: did so, I believe,

;

2.90

$ 3,389,987
$

■

3.06

'$ 3,033,624

1.60

again

Earnings Retained in the Business

$ 2,869,944

$ 3,087,186

$27,879,094

...................

;$30,618,768

generally because of the fortunate
circumstance

that.

corporations

and

found it necessary

ket and to raise

great

many

Working Capital at End of Year,.

municipalities
to come to mar¬

-the aggregate

witnessed

in J

J-

6.4 to 1

10.6 to 1

$10,059,531

v........

■'-$ 5,227,061

•

*
'

■' :

tmusualiy large amdunts of capital,
in short; such profits as were and
are "being realized reflect mainly
the sheer impact of. volume. But
volume in the very

Ratio of Current Assets to Current Liabilities....

Additions to

Properties During the Year......

' '.•

$12,100,000

Long-Term Debt

$12,875,000

years

Total Assets...................

$86,195,953-

can

hardly be expected to be with

large amounts

recent >

••

$76,279,771
f

•'

always and* with any falling off,

Total Net V/orth.

$69,055,317

$60,342,535

•

•'

i
i

may

see

soon

thereafter begin to

what- many

have

long

competitive

forces

business

our

contended,

i.e.,

have

unit profit* margins down
realistic
comes,

believe

levels.

When

incidentally,
we

shall

$59,222,317

that

•'

that

9,538
,

time

further

10,947

un¬

personally

witness

Number of Stockholders

driven
to

$50,509,535

i
f

A copy

if the 1952 Annual Report

may

be obtained

upon request to

the Corporate Office, 61

the General Office: 20 North Wacker Drive, Chicago 6

Broadway, New York 6

Continued

jrom first

audience

page

The Aircraft

'52 for the
Navy and Air Force, and none of
the almost equivalent amount ap-

Continued

from

page

procurement

By WILLIAM J. McKAY

down the costs of

curement of

aircraft, it would

ap-

that was direct, inland Pear that over the next few years
miles north of McMurray in this and already served by air com- they will be operating at the anprovince is a deposit of sands con- munications. In other words, the nuat rate of as much as $8 billion
taining an estimated 900 million highway linked up an existing in the aggregate, or approximately
energy

field.

barrels

nearly

Located

oil

four

over

and

miles. Locked
the

largest
oil

Alberta

science

chain

available to free

the

source

Even

close to 50%

but I have managed only to sug-

everywhere.
terial

the

production is

for heating

the form of fuel
,

the

marks

province. Their
useful not only in

fever

course

there

ma-

must

vou

caueht

have

But

anH

that

sure

that

feel

reserves, or about 48 billion tons.
Over 200 coal mines are at present

operating

of Can-

scope

human

resources

Canada's coal

of all

staging

West

I feel I have spoken far too long

is coal. Alberta has

Then there

North

famous

route.

now

benefits gest the variety and

its

men

the northern wilderness years be-

single

make

pioneered

bases,

fore by Canadian bush pilots and
other personnel. This was, in fact,

have

power

air

square

shaping the key that
will unlock this unique storehouse
of

course

one re-

Canada

world.

area

a
half
in that

known

the

and

some

Texas
re-

ITIOTP
more

one

claim I would like to stake before
I finish

but

also to some extent, in the produc- Proud of Financial Achievements
tion of power to supplement the
Canadians are proud of their

the peak of their World War II
business. Certain of the 15 compaiues, taken individually, are opgating substantially in excess of
theirbe
wartime peaks while others
will
below that rate.

the condition of

the

in-

aircraft

dustry seems to leave an optimistic ring, I must add a few words
of caution. The greatest peril
faced by our program and by mdustry is the repetition of a process euphemistically called reprograming. Whether reprograming
is due to an increase or decrease
in force levels oi*^ change in force
+u~
composition, the effect is the same,

shafimsp!ak°of only oneTrqfect!
Kitimat.

one

There

mountain

river that

will be turned back

its

150

course

miles

aid

the output of aluminum.
A new railway is being
t+

from Terrace to Kitimat

thaTreserveUpower

available

step

cents

ried thr0USh to net- A S°od deal
has been said~1both Pr0 and con
~concerning the pricing policy of
the Air Force' Particularly with
resPect to Profit margins. In some
1

™thf authoritative quarters m
Congress, the view is entertained

that the aircraft industry is being
treated too well profit-wise by
Se''vle?s;, In ^dustry on the

tons

a
,

has

States

capacity

built

after a two-year period punctuated
by at least a half dozen reprogramings resulting from the suecessive increases of Air Force end
strength from 48 up to 143 wings
and such fiscal-political decisions
as the stretch-out of last January,
the Air Force can keep its sights
fixed as they are now, namely, in

economic

part

the

to remote northern
as

and

well

1930

the

and

our way

the

money

American

reputation

great influx

capital in

this

con-

now

are

quired for

for

ment

On this score I am glad to be
able to report progress in the cost
reduction program undertaken by
the aircraft industry^at the urging
....
, —-•
0f the Air Materiel Command and

The industry has, over the
past two years made real advances
in such areas as (1) conservation
0f materials through such steps as
v/uuv
COntrol; y f better produc(2) Uv Uwti

scrap
DvJl GJ^/

Cv711il vlj

ti0n planning, scheduling and
standards; (3) methods improvement and new manufacturing
techniques; (4) standardization

interchangeability of

and

The

Lake Athabasca,

northern developbeen
expedited
and

parts,

°f

—

°ft

—

In the first place, there could

be a major change in national polbe a major change s national pol-

velopments in foreign affairs. A
sudden increase or decrease in in"
'
*
'
ternational

tension

would

automatically change
defense program.

Industry Profits
an

annual volume of
a year for the

$8 billion of sales

men-

might

flow

from

almost

present

our

It is also

ceivable that such

con-

consequence

significant

po-

litical developments in this coun-

reflecting

try

themselves

de-

components

rials,

iro

tracts —these companies' total
profits after taxes of 70% will be
*

26% of their

1954 as the. net assets of aircraft
companies are increased through

earnings.

These

n ng

major

ported net income per dollar of
sales of 2.2%, 1.7% and 1.8%, respectively, and return on net asjet-propelled outboard motor.
sets of 37%, 26% and 1-3%, reWhat I am stating is not offered -spectively. Bear m mind the net

referred to Canada

ment.
ment.

our own

as an

exoeri-

vision and a great achieveIt is more than all these.

speculations,

Similarly,

improvement.

considerable savings should result
from simplified inspection proee-

dures and reduction of expensive

and"repetitious Testing"
and aircraft engines.
and

nine

■■

of aircraft

Better plan-

scheduling

eovern-

ment furnished equipment would

costly out-of-station
Sfout-ofisfS

avoid

instalinstel-

■

American system and the state
of the world in which we live. No
our

amount

advance

planning

good management can do much to

mitigate the

would

just mentioned.

other

are

But there

conditions

our

program

measure

which

may

and which

within

our

con-

makp

dollars

our

some

direc-

these

tions AMC has

tion;

consequences of con-

also

further.

aiready taken acothers much remains to

d0ne

tingencies of the character of those
I have

profit imperil

rates do not compare unfavorably,

To put it briefly,

paddling

systems

and

hinges On Air Force specifications,
n
a field in which there is room for

cB,ut th.ese nsks t0 the stablbty lations and delayed acceptances,
Uectmg current rates on both con- of the Air Force program and the Better spares provisioning and less
Air
Pnrpp fivprl price anH CPFF
indndr,,
inVwiranf
in
Force fixed nripp and PPFP nnn- aircraft industry are inherent in
piecemeal f oT 1 o w-o n ordering

national canoe; we have attached

our

has

with the fol-

industry's standpoint, with
being re- 1943-1945 results. During that podevelopment ri°d these same 15 companies re-

resources

not only

y/e are

Hk!x,near tbe Arctic Circle, of

of the money currently

pitchblende deposits
Port Ha- in any spirt of boasting but rather
dium, 1,000 miles north of Edmon- with the desire to make more
ton, is still the most northern cen- widely known the extent to which
tre in a mineral empire that now
this country has stood on its own
includes Yellowknife
Port Nor-feet, internationally and at home.
man
Oil
Field, Goldfields and
At. the outset of my remarks I
Much of

came

providing upwards of two-thirds from

prospecting resulted in the discovery on the shores of Great Bear

JJranium City

this issue, I

themselves

Canadians

1929 ;jn this
country.

planes

independent analy-

lowing conclusions:

nection, I should point out that retained

points in win-

use

sjs which

quarters of being cautious 2.1% of net sales,

spending

experimental

summer.

paying

appreciate having

prospecting flight out of Edmonton proved that planes could fly
ter

made

the de- net assets as of Dec. 31, 1951. This
velopment of their own natural latter percentage will obviously
resources.
Much as we want and decrease
somewhat by
1953 or

when

was

satisfy myself

pur-

nf
of

some

March, 1921.
That

had

dollar

defense

Assuming
are

last five years.
Canadians have

145,000

possibilities
continent

Today 50

tax

every

a/e renational rlpht in tnp
?•
approximately
nnr national debt in
our
the

Jc©/
15%

largest

Turning to the Canadian terri¬

the

Cost Reduction

anytmng more on that score. And latter being a composite figure rea
VT
A*~

tories in the far north, it may be
said that the curtain began to lift
on

better job

frUStrat6 g^hUeverTon P

hopT"'

We USed to have the second best tioned, and an average profit be- cisions drastically to revise downmon.ey in the wor
1 won't say fore taxes of 7% of sales-the ward the defense budget.

tons of aluminum per year.

that

we can

management and husbandry
with the dollars given us whatever ,be their purchasing power,
0f

vent hope of all concerned that, tion.

famine." nature of the industry, icy growing out of unforeseen de-

balancing our national budget. 15 companies that I have

are

7,
t...
the United

out

^timat

The

year.

smelter of this kind

this country goes for

SSfJ JSS
production of aluminum to 500,000
metric

^.^have'been^
particularly in the failure to give
partic'"larly
to give
enough weight to the "feast and

P°ses.

will be

toe

the

giving financial
United Kingdom and

well

other NATO countries.

through
a
ten-mile tunnel for
production connected with

extensive defense costs up

date,

power

pected

But

about.

are

In the first place, there could action within the Air Force. For
action within the
example standardi
.£??P°VSh,.
tp^S?
example, standardization of mate-

our

directed

and

are proud>

too, that we Canadians are CMWcarry-

the

taking the peak off
and dumping it into

Vif11!6

Aluminum Company of Canada is

actually

prices

^ Including unToubtedlv'some SS'^f toe®148SSiaFbv Tf- (9 3 Wgher
mTd%5
sTverll
utlllzatl0n'

our

Alberta's

the

higher im¬

something that
neither you nor we in the military establishments can do much
terial

T110? /or sales volume let namely, to set back the Air Force with the cooperation of most of
us
J*
+uOW
in" b d7uP ai?d to unsettle industry, the individual companies as well
co^e^fnim^these^ales will J^e car- As I have indicated,it isthefer- as the Aircraft Industries Associa-

hydroelectric plants.; recent financial achievements. We
important coal reserves'proud that we paid our way
0f those present here today, that
Any one of
ocwrmay soon be
used in the large through both World Wars without
Se^&Tor ^'teastthe ^Air rencesJ'could '"however' lrustam
scale production of cheap power. ;
requiring any lend-lease aid from
toothat
'
output of

aircraft and re¬

equipment.

creased labor rates and

Danger of Reprograming
I|AU. Uah:..m«. A UAfti«N llfiJU
15 companies receiving about oneIf what I have said thus far
banana S H6W liorizonsi A nailOMtlOe OUlVey half of the combined military pro- about the Air Force program and
9

the
hold

To a large exthat should be maintained in the tent, unfortunately, those
costs
national interest.
are 'not
within our control.
Inlated

With these

propriated for FY'53.

behooves both

Air Force and the industry to

Industry Today

any

require

by me.

therefore

Canadian Securities

not

elaboration

source

September 18,1952

The Commercial and Financial Chronicle.... Thursday,

(1034)

Qur
^
per

si0gan

of "More Air Force
is not a mere v..„v„
a iiiviv catch

Dollar"

ju/v/iiuA

phrase*"iT is*a
necessarv
no

very

maior change

serious"lmd
If

objective

assuming
condi-

in world

trol, and when I say "our," I refer "tions
this country approaches
to all those concerned with air «rst the level-off period and later
power both within and without reduction in military expenditures

the government. It is these conditions which I would like to consider with you briefly.
'
!
Among the causes for the fre-

__rVcles which

quent reprogramings by the Air

fssets of these companies were Force over the past two years is
J®ss durmg the 1943-1945 period 0ne that I have not mentined be-

are

bound to come

regardless of the outcome of nex.t
November's
Force

Air

election^-the

is going

maintain

hard put

readiness its

143-

wing force.as the .aircraft industry
to

sustain

its

present

healthy

tbai? they are today.
fdre, namely, reprogrfjmings of condition. To satisfy what I beThese statistics, to my rmnd, go this character, of which we have iteve are the requirements of air
far to ™eei any argument that the had several in the Air Force, form power wiSha A defense budget
Ja vicious circle>for they feed upon compresseTto say 10% of^ie
the Air Force will result in inade- themselves. For example, when gross*naUoTal"product will call for
Quate profit margins, thereby we find in 1952 that aircraft or.

^t^On toe" othw^anilfdoes' dered^w0.

yfears bef(?rf. and fi_

rdLnin^^n^industr^^anage

struction of
helped by the construction v/x the Canada is ««vi a great hope.-. With
^ua » also a
Pan<iud au!_?/_ap?-Ta?^iat!0ins d1ur" ment of which this country i
ing that earlier period cost, when ,caDaKie
AJaska Highway. We hesitate to its human resources and with its
esUnmted nrofits if realized will
ts, if realized, will delivered, substantially more—
L.
\.
give Americans the entire credit oil,
natural
gas,
iron,
nickel, be
excessive, Darticularlv When say 10%—-than we budgeted for,
particularly when
achieve a real economy Y
for the miraculous completion of alumjnum, uranium and titanium,
.htx
h r^iiitarvr air one of two
things must happen. ?ur security programs will entail
this 1,200-mile highway in record- Canada, with the -United-States!
mft t
toto
breaking time. The road followed can together form the solid and
busmess are taKen mt0 ac The Air Force can go back to *^ar greater selectivity in military
nnrlnt»i
Lo cli
a-P PLa Pvaa iirnrl/l
*
Congress and try to fund the de- forces and weapons than has ever

"Seessive

gi~^1aken

■

n r."

This

company,

2nd, 1670,

may

incorporated
be the oldest

borly comradeship and

May

United

the

cial company in the world. Because of
its
diversified
operations,

what

oil development in Western
Canada,
trading and retailing, a continued rec¬

including

ord

favourable

anticipated.

earnings

may

investors

for

long

|0 px0ve a point and that
statistics are often

needs

can,

* us

supply. Side by side
,...

-confidence

and

high

fj®ns'

as 1 have

condition today, and the prospects

mankind.

term

that it is entering into

are.

Details

riod of

request.

Edwards Adds to Staff

Inquiries Invited
(Special to The Financial Chronicle)

ST. LOUIS, Mo.—John A. Wutzler has become associated with A.

Kippen & Company, Inc.
Investment Securities

Established

taxes.

miiitarv

indeed

be done

money for

But the time will

mav

the

come

not be far off*^-

pe-

681 St. James St., W., Montreal, P. Q.

and Midwest Stock

Telephone UNiversity 6-2463
(

was

accomplished.

The

policy

deci-

+v.

Aiv

event, the Air Force would

n0t tbe sole responsibility of ei^ Air -pofce br the aircraft
nnfl

some part in those decisions and

be substantially affected by
^ ™sults. All of us must, there^

f?re> approach the future with a
sharper sense of the seriousness
of the problems that lie ahead,

whiie at the same time allowing
have to reprogram downward not ourselves some satisfaction out of
only to absorb by reductions in what has been accomplished up to
it will end items brought about by the inow<
;

ditures for aircraft fall below the
level of $10 billion a year,
be necessary

to review the overall

assumed 10%

deficiency but also

toe additional costs generated by

inJcnn

GREAT ^

Judson

so ^
^ e aggregate net income the cutback itself. The conse- ^ strong is engaging in a securiwith Fusz- will bear a reasonable relation- quences of such a reprograming ties business from offices at 2

Exchanges. He

previously

Schmelzle & Co.

have to live within its budget.

prosperity in spite of high
When total military expen-

Streefimem&ra°of'the^New'York Picture of profit margins and taxes

1922

can

to. that -process are

with some of appropriate more'

the earnings analyses put out by
industrial sources. Nevertheless, I

capital appreciation.
on

the nast and-perhaps

misleading. Some of those present pe0pie, through their representaand may take issue with my conblu- tives in Congress, are willing to

hope, travel steadily toward the believe that the aircraft industry, when the Defense Department like
goal of a brighter day for all as a whole, is in sound financial 0ther American institutions will

lie

looking

we can

States

The^ stock is particularly attractive
to

that «^Pne can w fidency." iilfe^s™been"doneV'in before been attempted—far less

•.1

coopera-

of the United States just as

tion

commer¬

oftoefuturetlWe°need SKIffiw
the future. We need the neigh

HUDSON'S BAY COMPANY

ship

to the size Of the

industry

are

sufficiently

familiar

this Deepdale Drive.

Volume 176

Number 5152

Continued

from

The Commercial and Financial Chronicle

carrying on of a program of ef¬ tive rulings on questions within
fective regulation.
their special competencies.

page

(1035) '27

Finally,

Blue Sky
and

common

Now,

its

mission

action

which

primary objective the

there has

United

proper

amount

risk

capital

for investment in the

prise and

terprise with

enter-

the reorganized ena future.
The plac-

terprise. This objective itself is
twofold; first,
legislation
and
regulation must enable legitimate
business enterprise to obtain capital on advantageous terms and

ing of too

many obstacles in the
of the public offering of se-

way

curities of such enterprises results

frequently in the private placing
such

securities

with

the

obligation

have the

should

authority,
to the extent constitutionally pos¬
sible, to make binding rulings on
questions of interpretation, par¬
ticularly as to exemptions and
exempt transactions.
As

the

obtaining

thus

few

foster

the

development

general

would, I think, provide effective
regulation and accomplish to a
great degree
the objectives of
which
contained
provisions for
uniformity and simplicity.
accomplishing the objectives
It

would

which

have

the

and

commission,
consideration

public

securing

and fast,

careful

been

outlined

appeal

might

approval of the legislative

assem¬

blies

With Founders Mutual
(Special

to The Financial Chronicle)

HASTINGS, Neb.

—
George J.
now - associated
with
states, provided, of course, that Kister is
Founders Mutual Depositor Corp.
problems which face the se¬
of
Denver.
curities
He
was
administrators
in
such
previously

most,

not

all,

the

states

laid

were

experience

sioners
with

such

before

Uniform
model

Uniform

Sales of

Uniform

utility

have

sufficient

statute

secure

means

cooperation

that

seem

suggestion it would

be desirable to work out
of

The

final

fraud, blue sky legislation and r other agencies in the state gov¬
regulation must make possible the
ernments, such as the attorneyeffective financing of private en¬

available

new

object which this Association

trator

Today, in addition to preventing

considerable

nancial integrity of utility enterthe extent of its power
to do so—and that there are times
when increased rates are in the
Public interest.

always been in the

States

its

uniformity

might materially aid. An adminis¬

PUses to

has

protection of the investing public.
But

recognizes

uniform

of administrative interpretation—

to preserve the soundness and fi-

quarrel with

can

one

administrative
as

interpretation

cases.

such

statute there should be

Legislation
A Lawyer's Viewpoint

sense

applies in other

under

Stock

the

State

statutes

Goods

Transfer

with

them. connected

Commis¬

Waddell

Reed,

Inc.

Laws
as

the

Act, the
Act

and

Joins Bache Staff
(Special

to The

Financial

Chronicle)

GREENSBORO, N. C. —Archie
B. Joyner has become associated

others, is proof that with proper
with Bache & Co., 108 Market St.
presentation, substantial uniform¬ He
was
formerly with Merrill
ity between states can become an Lynch, Pierce, Fenner & Beane
accomplished

authorita¬

fact.

The

results and Thomas Darst & Co.

who

are

possessed of large means,

individual enterprise and initia-

and

the

exclusion

tive; second, legislation and

investor

who

amount

the smaller

has

risk

latl0n

certain

investors

form

that

enterprise

are

the

risks

the

obvious

regu-

available

wide a variety of
honest investment opportunities
as possible, ranging from those in
which little risk is involved to
tkose which are frankly specula-

capital to invest,

Tl«e problem is to make sure that
the facts are made available in
stich

should make

the

possibilities of gain. Statutes and
administrative interpretation and
practice alike need overhauling+o

tivTe-

■?

permit the offering of the frankly speculative security which is

1 think
ls.a fair observation
that these objectives are being
sought and to a great extent accomplished within existing legis-

offered

hition through the efforts of the

legitimate investment

opportunity and not

as a

circumventing

the
'

majority

Breat

gambling

statutes

means

There'll

investment

bankers and securities dealers who
cooperate fully with the securities

The
not

solution

I do

easy.

not

worthwhile

very

believe

quiring

the

results

securities

re¬
j.

°W

always be

various

The Needed Legislation

every

the

But t|lRse efforts without
legislative rev1Sion are not enough.

that

state of Illinois achieves

my own

;

administrators

the problem is

What
VY licit

kind
xvllILI

of
UX

legislation
iCgi&IciUUII

cookie jar

1£>

needed to accomplish these objecS2LnS' *XC Pt \ °f tives? In addition to the principal
hi-ir- +
i
u
i
«fi
exempt, to need for effective regulation two
fn
e a^f. dleseare spec!lla' principal requirements for secut ve
securities.
This
method
_

rjties legislation would seem to be

seems

mo£e like an open , uniformity and simplicity. FurIhwi ?11
c?a
Te
a s°und thermore, uniformity and simplic+1P.01
Ca1 of suspicion and +1fs ity can be secured more easily
?*any
the attitude «?'n*
the
•

tpan

emp lasis

rjty. ab°ve all

sacrifice,
by

ulation

secu-

require

the

proper

opportunities

making

investment

better

risk

available
for the

capital.

facts

that

good

those of
small

legitimate

and

available

are

oppor-

only

to;

great resources, and the
medium sized investor

and

is left without opportunity for his
risk capital or is made the prey
v

Of :

the

unscrupulous

whose attitude

ties

individual;

made

laws

were

that all securi-

only to be

violated

; The thoughts that

here

ex-

pressed, outline some of the problems inherent in present blue sky ;
\ legislation.
Some of them might
be

solved

within

the

probably

corrected.

could

What

are

not
the

the enterprise should

^ .characteristic of this type of
?glSi5 1?°* dVt°reover, - there,
should be provision for continued
s c, supervision of those who
^ the requirements to engage
P** S^pHes business, involvvisitation,, inspection and the
requirement of periodic reports,

lli?ea1L^atute^of }hiJL ^pe
effective

^aaedte^ for non-compliance, subonly to such court

review as
ark1-r

y action^ vThere should also

he criminal-penalties for fraud
and dishonest dealing,

possible

Such statutes should require
viously reouired. One is statutory dealers to advise the adminisrevision.
This is primary.
The trators to whom-they are responsecond requirement is informed, sible, of the nOn-exempt securities
solutions?

Two

things

are

ob-

positive and uniform administra-

which they intend to offer.

tive

ficient information should be

interpretation.
Blue Sky Objectives

Blue

sky legislation

appears

have two

objectives, both of which
recognized by legislators,
there is the prevention of

must be

First,
fraud.

this

Once

was

the

sole

our

belief in education,

decent clothes, proper
care.

All part

medical and

of the American

form of such

framework

of existing legislation but most of >;

them

along with

way

of life, the highest standard in

the world, but
stiff demands

That's when

occasionally making

pocketbooks.

Beneficial Loan

helpful—by providing

bridge the
without

The

gap

necessary

olistic

Today

the

only to prevent

utilities

consuming

from

public.

conscientious

public

a way to

entailing family sacrifice.

Sufre¬

quired to be submitted to provide
the administrator with all of the

Beneficial

than

700

country

offices of the

System

worthy

purposes

—

repay¬

monthly instalments out of

income.

They

are

helping to keep

the cookies in the cookie

this

and Canada make personal

loans for
able in

Loan

jar.

Beneficial Loan is for
a

beneficial purpose.

essential facts^ concerning the ofBering. But the * requirements in
this regard should be the same as
to form and substance everywhere,
Such

statute

should

give

the

business

monop-

gouging the
Today every
utility

can

between paydays

securities administrator power to
world has developed beyond the issue a stop order in any case in
point where prevention of fraud which he belieVeS that a fraud is
is sufficient.
There is a parallel
being perpetrated or the statute
in public utility regulation. Once in
other resoects is not being
such regulation was believed to be complied with.
*
objective. "

goes

In addition to these provisions

--V

are

proper

a statute dose scrutiny is made
t -ose who seek to become securltl®s dealers. Rigid requirements
'as tof *™Pcial responsibility and
carefully drawn provisions for
the personnel con-

Far

forth, than the
piling up of obstacles in the way
of such offerings, with the resuit
tuniths

accomplished

Keeping cookies in the house

dental

Under the

set

are

effectively

mos^

statute

supervision of
s'uch offerings to the end that the
true

primarily

by the dealer-notification type of

seem

open

the

regulates

wh0 engage in the securities
business. This kind of regulation

depression
have
Proper regwould

0ther way by legisla-

the-^ose

overcome.

securities

any

^on

engendered

were

great

been

and

whatever

ese>

that

the

never

safety

upon

com-

Of course, proper fees should be

provided

permit

the

employ-

ment by administrators of

ficient

staff

an^ to

permit

suf-

the

WILMINGTON,

Subsidiary loan companies operate under the following

names:

DELAWARE

Personal Finance Company

...

Commonwealth Loan

Company... Lincoln Loan Corporation... Workingmen's Loan Association, Inc. ...Beneficial
Consumers Credit Company

.Provident Loan and Savings Society of Detroit

Finance Co.

The Commercial and Financial Chronicle.,. Thursday,

(1036)

Continued from page

expanded

inflation

and

pressing

have

which

government,

services

crease

cu-

September 18,1952 *

needs without

in the

any in- There
will be
possibilities
of,
debt total, vitally important long-range econ-

present

increased for nearly The expenditure for capital imit is appropriate that provements for the past two years
real estate should bear some rea- has been close to $200 million a
mulatively

New York

City Bonds

the following:

are

(1) Is the debt excessive in
■

re-

T.,

<3)

....

there critical

.additional

costly

need

for

debt service requirements.
estate

tax

produces

payment

the

service

City difficult?
I want to avoid

burdening you
figures, but we are

with too many

compelled to

I will

measure.

ces

them

use

1952 in most

some

rounded fig-

use

simplify,

July

slightly less — probably under
$3.10. This is considerably lower

debt

gross

rfiessea value

referred

This is

was

high debt

estate in New York City is slight-

state
state

and
ana

Ixmds, the debt of
There

ponas

Fed-

various

well
wen.

things about New York
a^debt, However, that should be

PVnedient

fpmn.rarv

revenue

nearly

poses,

gross debt

producing pur40%
for
Rapid

Transit and nearly 20% for Water

The

supply.

Water

Department

is self-supporting and is probably
the only public service enterprise
In the

and

nro^ram

and

Wlth

Accounting practice at prescnt, unfortunately, does not make
entirely clear what the status is

bonds

Possible

that

manner

been

uccu

nn<-

tending
values

real
Citv

w h

estate

the most

New

a n

the fear of higher taxes.
o+Q+0

rnncfitntinn

ina^ ^ay

deficit.

above

£ - otber than debt serv^

quoted

made,

was

sure, with the view of discourag-

,ng

has asked authority of the State
Some

0yf

a( tbe tlme favorabie action

par"

of°

the

Avenu^

Subwa'y. The
thfsl VOters appr0ved this pro1ect when

Second

i8% of assessed value.

It may be

appropriate

here

repeat

that

New York City has no over-lap-

ping debt.

This

quite unique

oniong our largest cities.

(3)

50%

Practically

New

York City debt is owned and held

by City Sinking Funds and New
York
City
Retirement
System

the

in prospect in the

as well as operating costs, but
(a) Taxable resources are
Q
°
,

not

presently under undue strain.

<b) budget percentagefor debt
The required of the

total

service

not

w^The

thfm0It

tax

entirely free .hand in soliciting

and engaging outstanding and m-

dependent experts for studies in
their

specialized

Luthur

Size results m staggering
responsibilities and capital outlays

Gulick

rector

of
_

fields,-and

reS

DroDertv

fn-

revenues

deoendable

source

™revenues includfnf
(revenues, mciuaing

otner

state

jSfned ^

e*> .no sucb limits apply to proaeoi
debt

ror
for

tion_How far
w|thin

can the City go
economic limits in

sound

planm"g a"d Providing for both

P«aent and expanded public servICCS Wltho£t pj?cl.ng an Yndae or

ultimate

crisis,

should

observed that for each

five

and

years

budeet has shown

of the

vear

ODSdrX,da inai Ior eaca year 01
past

more,

the

whole

will

for

«rpativ

S £
•

What

hard

eventn-

the

sav

JJ 1S Varcl t0 say;

do know there

credit balance

structure

noint

afford it

can

a11^ be threatened.
answer*?

Umus!

}. e. P.° nt

5, sliyctu5e Y[iii

Xns,

but
the

bevond

tbp

low

to,.

Gxtend

not

are

many un-

extremely

fCinSeSin0somee "expects,

might nresent

vear

city renders

services

•

operating ouaget ana where tbe City

after

vear

usuai

budget and

repeated substantial annual def-

icit

The

ance>

Although considerable

lems of the oneratine

on its finan¬

"al and taxable,resources?
The first subject for review

service
service.

comment has been given to the prob-

y.e

opportunity

imnroved

manage-

imProved

manage

efch year'°eZ In^ontralfi36 ^^tfour present sKuIf If

Sinking+

owned by its

and

obligations

government. present structure of
part
It

may

Citizens

significant

Union

that

committee

se-

douX^tud^

n0USly StUdymg the P°sslb,llty o£
proposing
the
council-manager

Retire,Tent P^ for"

whether

question
might

prLate

corporation to

tohanyf?uch
debatable

it must be admitted it
the

serve

Sated
There

icit

def-

^nt ^ Bsay° b"

share of rising costs

compared with

ating surplu3. disregarding debt 0f the

crisis

the

some question
wise policy for a

'Tl

luTthe^ Ckfta ha'd to face its
mTalTlts
put the City has had

servicei

until

There is

pasSed.

useful

purpose

above
are

other

many

phases

New York City debt struc-

than 1,000 communities dur¬

ing

last

the
1

make

sense

"taVr^n migW™ot
plai

"
a

large
large

a s-mai1

city?
city?

that

saying
be-

lu?lne,f hmftL,
old

the

work in

That's like
That's lik

f'^nv

Does

years.

claim

or-

way

2-?*
Je
may be that some modification of
management plan is the anSW.er'
♦

,In New York we elect a Mayor
who 13 supposed to be the chief
what Sid he undfrsTood
how' penslon costs are included, and discussion, but I wish to have executive or general manager,
"hat s.iould be understood, how- a prospective deficit for the year some regard for your patience Actually, he is required to spend
eve£ 13 that in spite ot recurring 19g2.i953 of $47 million, if allow- and other subjects on today's pro- much of his time greeting people,
PranTSeinVdesfremmaS ance is ™ade f?r the elimina«on
closing Iwould hke' ™ahing public appearances and
f!vJPd
xf n,9
^
of combined rides. In addition, to make a few observations on representing the world s biggest
hgh„t
the annual debt service on Tran^ Jhebroader aspects of the New City in a eeremonial role. This is

find

iast

year

$35

million,

ture

manifold

its

operations

and
that might be appropriate in this

gSBefore

important; but it is even more
important to taxpayers that its

^
Funds

uwliT' ll'onn

hold

approximately

$380

in United States Govern-

•ucut obligations.

(4) There

This

which

this

burden

prove

may

time

will

have

show.

e ot

pe at

ex-

Citv Comptrolkr

expenditure

and

the City Comp-

troller is to be congratulated

issued

snhstanc^ "!
There 5s always a need for ad™ditional capital inprovements in
^^
aga'"an operation that has the varied
"q1*0"3
Piously made W the demands such as New York City
_

has.

It is hoped in many cases the
aproiects Win be self-sustaining.

Fortunately;

the

City

for

responsible

When
Mayor
O'Dwyer
ap- management.vTo this a City Manpointed the Mayor's Committee a«er W0UM give his full time and
0n Management Survey, he well «xpert attention.
It is quite lm-

fhe soundnes\o£ the Positi°n he knew and made public
onTue has taken m this matteredgment of the fact that

statement

f^v.CCuuiB wuu una

costs

g costs

arid„ ^

emplified

outstanding $247 w
•ufflion New York City Housing
,
Authority bonds guaranteed by "
New York City.
The extent to ®?u3£
are

onerating

nressure

£his P ess

dollar

experienced,

business

annual

billion

bave

million

acknowlthe many

operating departments of the City
needed study and analysis by an
impartial and competent

citizens

the

for

proving

the

group of

purpose

value

received

imin

perative that a City Manager be
given sufficient stature and indePendence so that he can always
maintain his position as chief administrative officer and not be
involved in or responsive to pressure by political factions. With

al Animate tnat

SQme years has ha(J a highly c0m. services for the CUy doUars spent the manager plan or a suitable
f
^
and conscientious Planning This called for both more effec- modification thereof, the Mayor
The debt is not excessive in
i" iQM Time anH ayain T hive Commission and careful attention five and more economical per- would have far more time to give
relation to taxable resources.
If
"atedthat the exDensebudcet fa has be given to what appeared formance by City Officials, de- to the b render Pohcy questions,
been
the
public
service
enterprises
™i expensei budget k tQ
appropriate priorities as partments and employees. Under could !:-ow that th« major adwere
self-supporting as is true
conStructfon nmnoses as the among the many needs Pressing the Chairmanship of City Comp- ministrative problems were being
in most cities, the net debt in fact
a 'd
' Stenanle of for a«ention. It is the function troller Lazarus Joseph, this Com- competently followed and hanwould be relatively light. In spite
nroiects must be added o£ £be C"y Planning Commission mittee has continued its studies d'ed and £fe£ greatly relieved as
ofttie shortcomings of the Transit
trour alreadv hich fxDenditure
study the respective needs and with the full support of Mayor he attempted to fulfill some of
system, it is the operating budget
bPH ".a
y
g expendlture present a capital budget. The Impelliteri. Many of its final the many obligations that are
tnat is
under

operat"n'
.

increasing

strain

eei'

Ponrd
Board

f£tly. be^use af Operations, def- o1*r!tfS}h«StQ^iar?nfm ing the
dle an?ual not amending the State Constitution
Icits
Transit
in

Budget Director

the hudget needs for debt service,
Debt service requires about 18%

to increase the tax on real proporty from 2% to 2V2% for operthe total budget, which is not ating expenses when the Legislancw

accepted

TJhe
fitrarn

<S6I*VC^i

C>£nized

*u-

decide

what

cannot

afford

a_ step. If the next Legisla-

why

the

there

budget

the

law

.is

for

debt

prescribes

fut ma;ter

P^ad bff°Xa tbe1 a^lbS>e
^ ^be

accepted

the
to

essential

City

can

and

do.

One

can

stage how
expected

probafc>ly

0f new debt> it sbouid be character.
that

the

City

retired

will

much

The

never

sure

™ncfQnfixr TiarncGincr v>im

constantly harassing him.

Astute and farsighted over-all
----planning is called for

from

noted
noted

will

six months.

this

really

hopeful

that,

and I am
with
the

Mayor's Committee's studies as a
and
partial
background
and
guide,
e made and
thing sound decisions will be m;

good should be
effort of this

an~

important

make

sure

that

the

effective

administration

for debt retirement in long hours and arduous work of the great City of New York will
excess of $100 million a year for conscientious experts and com- follow. There will be a rare opthe

past

two

years.

meet what are sizable amount of
as

recommendations

t11 be provided

general election in November 1953.
now

must ultimately

In connection with the incur-

beln^ commonly ture eadier this year approved ring
maximum figuch

reason

taat

•

safe

-l

Estimate, after review-

recommendations of the be forthcoming within the next

costs

new

Thus,

this

debt could

be issued each year for the most

mittee members will be followed
up

forts

equally

conscientious

administrative

ef-

officials,

the transit operations - There

oHeliable tafome.

vision

Di-

Committee, has
brought a leadership and direc-,
tion of great value.
As the CUy faces the future u
must Come to grips with the ques-

excessive.

municinal

nther

Dr.;

Executive

the

come m micip;al revenues, is unreasonable-strain

Estimate in ap" PubUc

as municipal ently collecting.
Some, of these costs were substantially lower
normally computed, is ?re of questionable character as than today and when the Transit
<4,940,000,000, or approximately £ar 33 equitable and desirable gystera was producing an oper-

(2) The net debt,

4ebt

are

New York. We mi^ht
the City can afford Funds, any temporary problem wp11 at,k ««whv not*?" in view of
to go in financing certain projects, that might conceivably arise could ^ advantages in efficient, eco¬
'
y '™ew the
worthy though they may be.
be effectively cushioned by fund- nomical administration this form
Jhe ComPtroller's statement fng or delaying payment on such of government has brought to

This has placed great pressure on

eX eoTecttog

hncni

City has already
in both

^ajfZonlk foMhrv " by tbe B<?ard of
f.oweverWtha? the^Ra'pid TrS ^y of othlftaxt tha^the CU^ Sance^the cost
substantial

ably answered. We find that:

government adSome
substantial

Tbe Committee has enjoyed an

ones Can be quite accept-

given to Proportionate costs in York City's bonds

ritv

Jed va^ue

most

better and

taxpayers

c.aPital as wel1 as in the operating
ReId*

onaiitv

many ques-

raised

can

relation to other essential services

rpatriptc

vm-k

it is found that while
tions

determine

Tn states were reported in 1950 with

time

J1tate <-^sti*tuti<on restricts

™ ia*

and

ambitiolfs

quite

which

investment

the

c
a substantlal one on deficits and in 1951 the record
taxPayers- There comes a was 27 states.
when S()me regard must be
(5) With nearly 50% of New

'the

oteo[esctnce

the

t be recognized for im-

j facinties, the

to hoM

Although

Pr0Srams-

been

probably rent control

lDrecitiL

AHhonah

nrotframc

Proved transportation and hospi-

will

imnortant of

con-

annpar

franennrbfinn

in a manner tnat will

^egraf^flulnces

Present

going forward with either of

«* «lontirme these annual oper-

York

Estimate.

rf most of the public.service oper-

have

dltl0ns would not appear to jus-

impartially

difficulties for the operating budg-

the

Hi+innc

annroved

was

expeditiously

City that has this distinc-

'produces

them

pYPmnt

re-

f
.hJ frnilhfp
he
these
^0U.rLce °..,tne tr°ubie, snouia be
d

dealt

tion.

System

the

Board

factors

merifS

the

within

issues

vjews

one

various

unde?

are

vparq

while

*ts,a temporary expedient ana re
lief measure this fundamentally

down

(1) Two-thirds of the
for

issued

mav

for hospitals.

Pr°sram was approved.

unique

sizable

The transit system operations, the

interesting and

some

are

?ecent ylars

bonds

which

for

purpose
nr

{

further boost the real estate^tax.
This borrowing will be retired

ad-

authorities
autnonties

housing
housing

The
,

fivp

munieinal
municipal

outstandmg which includes,
all
ail

the expense budget

keen

high level.

Funding of the transit deficit £rom the Constitutional debt limit.
past years and through the 0
as an issue of $500 million

real prop-

It is, in fact, about 15% of
the total of all tax exempt
me total 01 an tax. exemnt hond<?
to
to

tend to
a^

ottLatll
real^prop- f^costwiltSrupoT^earestafe ^tpprovaT is'Tven'bf the
untl1 aPProval 1S Slven by the

taxable

crty.

■dition
<uuon

operating departments, if properly dealt with, will
City's

the

economies

Investment Factors

expanaea sex vices serious

,,VV

quUe satthan any of the larger up-State isfactory control and restrictions,
"ties. Buffalo and Rochester are ag provided by the city charter
both over $4 On the other hand and state Constitution. Interestthe per capita dollar tax on real . j the
le voted to approve

City
Comptroller
in
a
statement during the past month

rfwai

The

high contribution.

basic tax rate of 1952-1953 on real

The

$3,350,000,000.

the

need for higher revenues. In addition f° the expanded services

ly higher.

cases

face

should

costs.

repairs in many

improvements?

debt

sucb

the

efficient

ministration.

year.

improved

greatly

^ and inflatcd cos,ts'i°."£ lef!r5!d
Proportionately this maintenance and

tlV™®
York City.
is not

The

about

inZ

property in New York is $3.22.
What are the practical or After equalization as applied by
factors that might make the State formula, it would be

(4)
legal

and

on, real estate ^or fact there will be a continuing

470/

(2) What are the purposes for
which financing was done?

Econ-

share of this cost.

efficiency in government, if ultimately
realized, cannot absorb

omies

no limit on the right of the City
ta. levy taxes
real

-—

Xation to taxable revenues?

assure

years,

sonable

Their Investment Merits
wish to check upon among which

omies and benefits, which should

portunity afforded the City Administration, the Board of Estimate

and

the City

Council cour-

Volume 176

•

Number 5152

The Commercial and Financial Chronicle

(1037)
ageously to make
with

break

important

some

that will in

decisions

established

procedures and organized groups.
Recommendations alone, valuable
and

"There

carefully studied though they
must

There

desire

part of those qualified

icanism.

the

and in

Those officials will¬

tor

of $644 per
The

Chamber

the United

that

its

high

has

won

been

And

are

year

per

translated

Schmidt

many areas

Wallace F.

138

not

is the

Federal

in
previous

pay¬

reported by the
Statistics, which

Government's

priof such information,"

imary source

Dr. Emerson P. Schmidt asserted.

estimated

national cost

the

■of the "hidden

payroll" at "some¬
thing less than $25 billion a year."
The costs to the 736 companies

These

final

results

the

Chamber's third such survey were
^contained

booklet,

"Fringe

Benefits—1951."
hidden

The

Abroad

list

includes

employer costs

in¬

Fjbonus arrangements.
kittle

—

Chamber surveys,

know

was

about

"hidden

these

the

"hidden

extra pay for night

production bonuses, all of which
considered part of the regular

are

payroll.

railroads,

well

prac¬

down

W. F. Rutter Adds
(Special to The Financial Chronicle)

BOSTON, Mass.—Donald A. Bye

Street.

affiliated with W. F.

the

19 Congress

past he was with

R. H. Johnson & Co.

Chi¬

the

"Chronicle"

oil

11.

only

monthly magazine of

exchange,

Exchange, brings
important, timely and authori- ;

If you are

than

point.

Over all,

tically all other sections of the the operating ratio stood at a flat
market, came in for some profit 71% for the period
compared with
taking last week. No selling of 75.1% for the first seven months
particular

any

veloped

but

importance

the

cent

the

prolonged

months

some

that had been the

de¬

of 1951.'

stocks

prominent

advance

re¬

ground
end of the

gave

Naturally
the

benefits

substantial part

derived

from

higher

gross and well controlled expenses
was offset
by a rise of about

fairly
$1.2
easily. By the
week, million in Federal income taxes.
however, the tone had improved Nevertheless, net income before
considerably and partial price re¬ sinking and other reserve funds
coveries were common all
along jumped from $2,807,000 in the 1951
the

line.

interim

$4,206,000 in the cur¬
Earnings on the com¬
paid little, or no, attention to the mon
stock, after
allowing for
position and prospects of the in¬ preferred dividend requirements,
reached $3.68 a share, a substan¬
dividual company.
Stocks of the
roads that have done well so far tial increase over the $2.16 a share
in

usual

such

short-term movements the market

favorable
as

can

estimated, suffered

much

now
as

did the stocks of the roads
having
less favorable histories and
pros¬

rent

period.

realized

the

stocks

that fell off

the

months

seven

year ago.
It is anticipated that
traffic comparisons with a year
ago will continue favorable and

further
penses

One

fairly

strict

control

over

ex¬

virtually assured.

appears

On this basis, full year's earnings
of

$7.50

high degree of operating efficiency with
that

has

been

attained

recent

the

its

rehabilitation

company

has

purchased

was

to date.

despite

Even

July, and

traffic

strike,

gross

loss
rev¬

exchange

is written with you

The staff of the
in

clear

owner.. i

one

the.

in mind.

magazine discuss

non-technical

language

wealth of investment data in every
issue. Experts in other fields talk about
some

of the vital issues of the

day.

Recent EXCHANGE articles
is there foolproof investing?
a clergyman looks at
capitalism

V*:

soviet "propa-nomics"—
THE SCIENCE OF ECONOMIC LYING
52

STOCKS

WITH

LONGEST

DIVIDEND'

RECORDS
listed companies with no debt
what happens to stocks when
they
split?

PAR VALUE

vs.

MARKET VALUE

The top executives of

our

porations give readers of
the inside story of their

leading

cor-*

the exchange

problems and

operations.
Recent EXCHANGE authors
Crawford H.

Greenewalt, President, Du Pont-

Harry A. Bullis, Chairman, General Mills

Maxey Jarman, Chairman, General Shoe Corp.
Johnston, President, Erie Railroad

Paul W.

Leon

Lowenstein,

Chairman, M. Lowenstein & Sonsi
H. E. Humphreys Jr.,

President & Chairman, U. S. Rubber

not

prospects

lysts.

continued above year earlier* also
For the full seven months The

levels.

already

the Big Board.

You

get the

next 12 issues of the
for just $1.00. You get 12Q
articles, packed with down-to-earth invest¬
can

exchange

ment

and

thinking. Start your subscription nowm
will send you the current issuer

immediately.

•

of the first in

considerable

due to the steel
enues

one

of if you want to become

program

order,
or
contemplated.
These
the country to be
completely die- purchases, however, will be calcu¬
selized, reflecting which it joined lated to improve the basic earn¬
last
year
that
select
group
of ing power of the property further,
roads with a transportation ratio and in any event the present divi¬
below 30%. Further improvement dend
Itself
affords
a
generous
has been realized in the
current yield.
year

Rutter, Incorporated,

reported

Sept.

Building.

Gulf, Mobile & Ohio
/ The

scope

shift and Sunday work or straight

has become

Bank

Mr.
Healy's
association
with
Cruttenden & Co. was
previously

companies listed

The road

are

National

tative information about stocks and

payroll"

project.
included

First

Corp. and in the
Department cE

cago.

Morey L.

you

has reported fringe the stock at these levels as hav¬ fairly heavy. Moreover, consider¬
benefits only for the steel indus¬ ing outstanding intermediate and able cash will be needed for down
payments on equipment now on
try and this is not a continuing longer term potentialities.
Not

—

the

government,

payroll,"

the

Investment

Senator

years,
the favorable margin of large amount of new rolling stock
costs. profit, and the pronounced growth and motive power in recent years.
The Bureau of Labor Statistics, characteristics
of
the
annual
requirements for
territory Thus,
major source of wage data in the served, many analysts look upon equipment
trust
maturities
are

•of
;

the

struction Finance

Yours for

$8.00 seem possible.
sharply percentagewise in
Last year the company reported
cluding social security; unemploy¬ spite of
highly favorable earnings
ment and workmen's compensa¬
earnings of $5.69.
trends was Gulf, Mobile & Ohio.
tion; sickness, accident, hospitali¬ At the close last week it was
While the earnings picture is
sell¬
zation and death benefits; termi¬
ing to yield 6% on the well cov¬ particularly bright, most analysts
nal pay; discounts on goods pur- ered current
annual dividend of who have followed the situation
fchased; free meals, pensions; sav¬ $2.00 a share, and the price was are of the opinion that at least
ings and stock purchase plans; less than four and a half times for the time being there is little
vpeud vacations, holidays, rest and reasonable estimates of probable likelihood of an increase in the
Xiimch periods; profit sharing and 1952
dividend.
In
connection
earnings.
Considering the $2.00
Prior

Chicago loan office of the Recon¬

com¬

gild the lily!

pects.

payroll

he spent the past 11
years. Before
that Mr.
Healy worked in the*

the New York Stock

averaged 18.7% of their entire this
year,
and
have
payrolls, or 31.5 cents per payroll
prospects so far ahead

'hour.

urer

EXCHANGE MAGAZINE

part

the bulk of hidden
are

is
.

and!

12 ISSUES OF THE

em¬

surveys,

Bureau of Labor

lines

' '

York

Bennett

these
payments had
jumped 66% in four years—from
$410 to $681 per employee.
"In spite of this heavy increase,
and in spite of the impact of these
fringe benefits on the national
•economy,
roll costs

New

all-

the companies
which had

•Emerson

;

work

the

Exchanges.
He
previously Secretary-Treas¬
of Thor Corporation where

was

Booth is with Stein Bros. & Boyce,
Starks

ployee.

two

Alton

LOUISVILLE, Ky.

high

average

taken

rehabilitation

way

Stock

(Special to The Financial Chronicle)

be corrected, the better."

can

We would not

pay¬

For

company should
back on its rela¬

members

Midwest

last

time

$644

ing effect

costs

jumped

year

Wallace F. Bennett in "U. S. A."

their

"hidden

"History may have a different verdict, but the
only view available now reflects little if any credit
upon the Truman legacy. The sooner its deteriorat¬

found

roll"

Finally,

the

old

With Stein Bros. & Boyce

'big

ompanies
t

traffic.

decades have

736

the

policies of the past two

sur-

and

the

CHICAGO, 111. — Raymond J,
are
exploited. Healy has joined Cruttenden &
to be particu¬ Co., 209 South La Salle Street^
of

prospect that
cut

Gruitenden & Co.

from

ore

altered our traditional
concepts. It is,
indeed, surprising that the American public has al¬
lowed some recent administrative
policies to go
through unprotested.

y e

iron

Trust

accept¬

There

the

pleted.

govern¬
traditional Amer¬

not

able

expenses

announced

has

the

Raymond Healy Joins

company

substantial im¬

tively heavy maintenance of

of life;

in which

average

Dr. Emerson P. Schmidt has

icanism.

Economics,

improvement

action.

ment'

the

Commerce

States has

Director

and

ance

employee.
of

hence

into

States, finds costs of
"fringe benefits" to 736 com¬
a

prove

government'

United

panies jumped to

Corporation
lucrative

where

Research

mines

should

the

Birmingham

deny that. But some¬
along the line — and it
will remain for
history to say
whether it has been
by accident
or
design — the theory of 'big

can

Commerce" of

Steel

This

no one can

Schmidt, Direc¬

Economic

there

the real American
way

Payroll Costs
Cha/nber

Mobile

Venezuelen

larly

people

Estimates Hidden

Dr. Emerson P.

that the thing
the'past 20 years is Amer¬
kind of talk daily on the Senate

I hear this

port movement

those who will argue

are

year

getting

20 years has been offered to the
;

ing to accept this challenge may
earn for themselves a recognition
.and appreciation which they
arichly cherish.

will be

floor, but the more I hear it the less I believe it.
The political
legacy of the past ■

position to put them into practice,
to act with vigor, courage and de¬
termination.

the next

have lived under for

little.

accomplish

will

be,

may

future, it is expected that within

Hear! Hear!

cases

some

tradition,

only the near-term
that impress the ana¬

The

long-term

considered
southeastern

very

outlook

THE EXCHANGE
20 Broad

Magazine, Dept. D,

Street, New York 5, N. Y.
■

Enclosed is $1.00 (check, cash, money order).
Send

:%
|

the next 12 issues of THE EXCHANGE*.

Name

favorable.

territory

the gross topped 1951 results
by whole is still in a growth phase
nearly
5%.
The
already
low and the ports at Mobile and New
transportation ratio was cut an¬ Orleans, both of which are served
other point and a
half, to 29%, by the system, are expanding con¬
and the maintenance ratio was
sistently and sharply. Also for the

Address.

I
City

I
I

Zone.

.State.

—-!

The Commercial and Financial Chronicle

(1038)

Thursday, September 18,1952

...

Continued from page

of polit- of economic nationalism; actually
those who use these weapons are

to reduce the importance

ical divisions in terms of economic

America, of other areas, dis¬
today most effectively a

incapable, in the end, of delivering large

relationships.

Economic Nationalism

Latin

courages

and sustained influx of cap¬

into the heart of the promised goods, but by the ital and know-how from abroad
the problem. Given the multiplic- time this is discovered much harm without which no major economic
advance can rapidly be made.
ity of nations and states, on «one has been done.
'
The security and the prosperity
hand, and the fundamental natFilll Employment Leading to
of the free world
alike demand
ural unit of the planet, on the
Here

as an

get

Obstacle to Fiee Wotld Unity
the Reciprocal Trade

Agreements

But the world was be-

program.

ing increasingly torn by conflict
the impact of totalitarian-

and by
ism

and

time

exercise of

before

effective

was

upon

could make any impact

nationalism

of economic

wave

which

sweeping

was

the world.
Our

The

war.

leadership and the

our

World War

the tidal

upon

world

not ripe for an

was

Second

inexorably

moving

was

towards another

Santa

Role

our

too

long to be recounted here;
is, however, familiar and calls
only one comment. Instead of
launching an all-out attack on

for

nationalism,

Admin-

our

istration compromised with it. In-

playing

the

role

St.

(George to the deadly dragon of
feconomic

natibnalism, we ternporized and compromised in quest
of

modus vivendi.

that

found

Claus

that

was

the

A little later
role

Santa

George: we fed the
dollars hoping he would

dragon

turn into

amiable beast.

Need

I say that the dragon did nothing
of the kind, much as he enjoyed

dollars!

our

Now, however, as 1952 draws to
a close, we are moving towards a
very important turn of the road,
The year that lies ahead of us
will, I feel, be a year of great opportunity.
It may prove in the
annals of the future to have been
a

year

achievement.

great

to have been

may prove

of currency con¬

vertibility and international mon¬
etary reconstruction, a year in

will have called

protectionist'

the

halt

tenfencta

ProieVlloms^

tendencies

inwhlc^wTwill SvetSd

a year
avea*

in which we will have told

twe'are

aware

shipofour

^^rt'unities anc^of

ixidt we

are

of
oi

pi ace in
Place te

our

reqnonsihTitie?

our
uui

xe&puxi&iuuxues.

which
wmcn

world

ior

will

been

decisively dimmed, in which

new

international economic crises will

destroy

what

left

deavors of the past

which

our

the

few

friends

From
I am sure, many peowould heroically fight Keynes,

en¬

years,

will

dis¬

serious

Whether
success

in
shall

extreme,
towards

move

towards

be-

me as

the

disaster

de-

pends largely on us in this coun¬
try.

In Western Europe a new wind

of good economic sense is blowing

with increasing strength.
ments in
me

Govern-

nower
power todav in Western
today in western

Europe are led by moderate peo-

Defining Economic Nationalism

virtues of individual freedom,
,

mu.

Kei

economy,

„

iney

mar-

are

people

endowed with great common sense
and who have

cent

years

wis

of
"

given proof in
both
are

daring
.

re-

and
very

hard to put their houses in order

imported skills.

be put

to policies of

nationalism.* We

in America

Smith

alone

provide effective

can

big

which

question

that?

and

answer

fast

not to miss

are

This is

before

must

chance

our

world economy of
making our leadership effec¬
jobs enough for all. In
tive. The following, in conclusion,
free from reare some positive suggestions for
strictions economic development
an
American
foreign
economic
of any one area can be carried out
policy aimed at the unity of the
with the help and the resources
free world.
and skills of other, more advanced,
In

growing

there

are

world

economy

There is

areas.

actually

con-

fiict between full employment and

economic development, on the one

side, and the freedom of international
economic intercourse, op
the other. It is

tragedy that mil-.

lions of people all over the

misled

been

have

Lord

How

the

world

believing

into

it is up

U. S. Must Set the Pace

Our fight

to those who believe in

against economic

na¬

tionalism must begin at home.

suggested earlier in this dis¬

was

cussion,

we ourselves
still have
the protectionist virus in our sys¬

It frustrates

tem.

of free world unity,
but what exactly is economic na¬
tionalism? So far in this address,
I have used the term without def¬
arch

enemy

inition, assuming that we have, all

intuitive

Europe. They are the people who
have awakened — or are in the
process

then

loss

"Ecomic nationalism" is then the

commercial

our

policy by

some

paid
the

for

the

benefits

of awakening

—

us,

successfully

evil must be well untroubles

sfnce°?he

war

ha° consistedprl

allowing the

contours of

from the stroys
might

ternational division of labor.

day in the front ranks of the de¬
fenders

are

our

policies lost both
and

nurnose

dvnamism

In °rder to Perceive clearly the

Such

—

apart from the "protec¬

tion" of special vested interests by
means

of tariffs—were the

major

motivations of the relatively mild

and. who

sound,

to¬

are

time-proven,

principles of "old-fashioned
nomic liberalism.
A

fake

promise

welfare

States) during the nineteeth cen- security.

dom

greatly

was

respected

That

promise,

Two

too,

world

wars

have abundantly demonstrated the

those days and the powers of the hopelessness for any country to
state were limited, and the fact be strong

and through economic

isolation*

from the rest of the

England,

the

was on a

free trade basis,

use

resources,

many

moment upon

the

physical

structure

cies toward economic nationalism, territory.

collectivism

the

20th

century and the widespread (and
only too well founded) sense of
political insecurity have played
toahsm

^coL^XnSnVbe"

tionalism. Economic planning became! theintellectual fashion of
the^twenties, and the reality of the

thirties and the forties currently
and, throughout the course of his- it shows, for the first time since
tory, moving in an ever-changing the Great Depression, signs of rePattern of alliances ^and
.

conflicts, ceding.

Neither the earth's surface nor

its

interior

fully

can

divided

partially independent

The

distribution

into
sec-

fertile

soil, of climates favorable to hu-

well-being, of land and sea,
mountains, rivers and lakes, does

man

The interior of the earth,
far as it is open to, human
as

homogeneous

as> ^or examPle> an apple nor di-

econoraic

nationalism.

group

Both

the

reasoning

world
and

economy,

only

ob¬

that

country

ficiency and
it is also

the

in managerial skill,

very

costly policy for

great

sumers

often
are

mass of American con¬
and taxpayers. Consumers

fail to

paying

realize

it,

they

but

for a great many
of the things they buy because the
competition of foreign goods in
more

the American market is interfered

with

the

imposition

petition—but many want to stop
where foreign goods are con¬

This makes, of course, no

cerned.

sense—and

form of
In

the

been

it is

expensive

very

nonsense.

second

place,

maintaining, for
now,

have

number of

export surplus fi¬

nanced

com¬

Here

of friendly nations,

aftermath

the

war

should not mistake

^in

—

but

one

emergency

common effort protect
action for a new way of life. The
agalnst outside aggression, American taxpayer is getting tired
We are w0rking towards a com- of the load he is bearing; the "dol¬

mon

for

through gifts and grants to
foreign countries made at the ex¬
mon
endeavor such as that of pense of the American taxpayer.
NATO countries that one is most There has been much justification
{orcibl
struck by
the folly of for these grants at the immediate
a

foreign policy. We are work- lar shortage" is

planning ing towards a joint military force.
typical feature of the totali- And yet we continue having ecotarian state; but it can be advo- nomic
policies which create divicated also in the name of well- si0n
amongst us. Unless we decide
being or in the name of security, to abolish the use of exchange
The economists of the Keynesian controls, import quotas, high tarschool have been at pains to dem- iffs and discriminatory trade prac-

breaks

policy

leads the world in productive ef¬

years

Undermining of NATO

It is when one examines

n?^. ^avor the kind of political onstrate that national planning
d}vision which prevails on our fosters prosperity—even though it

pianet.

mentation.

Centralized economic

Protectionism is not

high

tended greatly to mitigate tenden- which are outside of the country's

own

com¬

rise

reflect for

other

their

tion.

the contrast which exists between

urging

of import duties. We all favor

der leadership emanating from world. National strength requires

of
our
planet and its political organiza-

let

nationalism,

when

liberalize

policies. The example
giving is what matters!"

solete

economic

tury. The fact that individual free- unfulfillable.

countries

eco-

Only a group of counRpf,ent r^anees Dramatic
working freely together can
^achieve strength This is the basic
More recently the situation concept of NATO and it is in urchanged very dramatically.
The gent need of an economic lmple-

economic

naj.ure

have

trade

State"

that a large part of the world unsequently

their products to the
public. Thereby it de¬
all the effectiveness we

daydream turned nightmare of the
"Welfare

understanding iorm

pSsence

fouSht>

ducers to sell

American

international trade and of the in¬

nationalism one of the propaganda weapons of
of its' meaning
The moment has which was experienced in some economic nationalism today: the
come where a precise definition is countries
(including the United other is the promise of national
of

pie, wholehearted believers in the exploitation, is not

private enterprise, and of the

end

one

the opposite.

farming, for example. These mili-

tions.

Common Sense in Western Europe

Adam

resources and is stimulated by the
availability of foreign capital and

tary, political, or social aspirations

In physical terms the planet is
over our leadership and
oufr foes cheered by our failures; a single unit which cannot be subdivided into equivalent or selfa
year in which it will become
apparent that the free world is
moving away from unity rather eYer>14 is divided into a multitude
than towards it, because of the of separate states, all bent on mgrowing, not declining, influence dependence, ofteq seeking at least
of economic nationalism.
Partial economic aelf-sufficiency,

The situation strikes

for full employment can only re¬

had

illusioned

ing

that

economic

our insistence upon es¬
economists have
been the virtues of private enterprise;
cape clauses which make it pos¬
for their country, who would sac- well-nigh unanimous in recogniz- and individual endeavor as against
sible to reverse tariff concessions
rifice their health and their wealth ing the virtues of unfettered, un- the paternalism of an all-powerful
granted
to foreign
countries
alike for national survival
but hampered trade relations between state to fight against the fallacies
(should it be shown that these
who will cling emotionally to the people living in the various coun- that are being
spread in the world concessions hurt some establised
last shreds of a worn-out policy, tries of the globe. Whenever de- by the adherents of economic naindustrial and agricultural inter¬
SUch as protectionism, not want- partures from free trade were ad- tionalism and its Siamese twin, colests at home).
It creates in the
jng to admit that the future of vocated, this was done for reasons lectivism. Actually, this is a task world a
great deal of uncertainty
their country depends upon its of a political or social character, for Americans, in the performance
as to the American market, since
being overcome and reversed. To such as military strength or the of which we can count, at this our tariff increases can
destroy
these I say: think well, think fast, diversification
of
industries,
or point, upon the able partnership
long, painstaking, and costly, ef¬
for time is running out on us!
the
maintenance
of
high-cost of
our
friends
from
Western forts on the part of foreign pro¬

who

pie

souna

have

foreign lands.

There are,,

fo^a found

hone
nope

economy

go.

going

ital in

cPriqe

year
yeai

world.

great- strides will have been taken

and

come

Administration

of
In the

1953 will have been
the year of an all-out frontal at¬
tack against the forces of eco¬
nomic nationalism, a year in which

which

govern-

to create an international

cessary

a year

another great frustration.

bodies,

public

ments and central banks, are ne-

system out of the multiplicity of
A national currencies. How this can
to be done was illustrated by the long
come
into office next January. and highly successful experience
The stage is set for great positive of the gold standard.
accomplishments in the internaDivision, on the other hand, is
tional economic field.
Will the fostered willfully or unwittingly
American nation as a whole over- whenever governments interfere
come the protectionist tradition in in trade transactions between resfavor of a dynamic new outlook m idents of their country and people
international trade. It is harder, ijving elsewhere in the world;
I know,
to change habits of whenever they restrict migrations
thought and long-standing pat- and travel; whenever they limit
terns of emotion than it is to ac- the freedom of people to buy and
complish anything else in the sell foreign goods or to invest cap-

former case,

in the direction

gift.

new

comfortable than

St.

prosperity rather than to get it as

Opportunities

endeavors
and frustrations of recent years is

stead

than aid, they want to earn their part

W?r.^ doesn't stand still,

Claus

Regimented Poverty

Actually, governmental planning

suit, in an economy insulated from, and dynamic leadership towards
that end. We are strong and young
the rest of the world, in regimented poverty. Prosperity is a and prosperous. We are the lead¬
ers of the free world in the
fight
child of freedom and of enterprise,
partners in a common pursuit of a was the doctrine and the practice Economic
development,
too,
is against tyranny and aggression.
sound world economy. They are 0f free trade. In other areas, such jeopardized by governmental reg- We alone can be its leaders in the
awaiting our cooperation and our as international monetary rela- ulations and restrictions; it calls fight for .economic unity and
leadership. They want trade rather tions, positive measures on the for the best possible utilization of against economic nationalism.

history

economic

other, governments can, through
if that means a temporary their policies, foster unity or increase
division.
In some areas,
decline in living standards,
ft
I had long conferences with such as trade, government can best
many of these statesmen as re- promote unity by standing aside
cently as May and June of this and allowing individuals to work
year.
They are willing to be our things out among themselves. This

even

tices, all of them tools of economic
nationalism, we, the countries of
the Western

Worjcl, will

most cer-

plaint in

familiar

com¬

great many American
households and there is a grow¬
a

ing feeling that Santa Claus ought
to be

not

Two

If
our

sporadic event in the life

only of children but of nations!
Sole Ways

of Balancing
Foreign Payments
are,

foreign

however, to balance
payments without

experience

tainly fail to achieve the unity making gifts or grants, there
which our? common survival only two ways by which this
be achieved:
fluence, however, although it has depends.
shows them to be wrong; their in-

zeni®' tt 84111

upon

Not does

the[practice of

eco-

(1) We

allow

are
can

exports
imports.
employment slogan is still ernments of the underdeveloped This would follow
automatically
litical division of the planet can very great in certain countries as areas of the wprld to join with
upon the cessation, of "foreign aid.
be reconciled with its physical is the appeal of the economic de- the United States ^and Western This solution would cause wide¬

contained portions as is an orange, able. The popular appeal of the

There is

way

in which the

po-

nomic

nationalism allow the gov-

can

full

structure by apportioning in some velopment slogan in some areas of Europe in a common endeavor for spread difficulties in
way or other the surface and the the globe. It is one of the trage-: a richer and more abundant life,
resources of the

vidual states.

globe among indi-

The alternative

our

to fall to the level of our

dies of

our age

that these slogans Economic nationalism ^ the un-

should have become the weapons

derdeveloped countries of Asia, of

industries,; which

are

our

expdrt

among our

most efficient: ones, and it

would

Number 5152

Volume 176

The Commercial and Financial Chronicle

deprive the? "rest of the world of
American
produced
goods
of
which there is great need.
This,
then, is a bad solution, for it is
prejudicial to our own prosperity
and to that of the world.
-

We can, on the other hand,

(2)

expand our imports so that foreign
countries could earn the dollars
needed to

central

banks

Canada,
tantly

much more impor¬
the United States is the

source

from

serves

could

which additional

be obtained

eign countries.
monetary
available

stantial

re¬

by for¬

would

create

magnitude

together.

world,

Unless

the liberalization of trade
revival

Nor

achieve neither

we can

foreign

Bank and Insurance Stocks

the

nor

investments.

monetary reconstruction

can

endure if

our

result

By H.

export

"dollar

and

This Week

open

widely

and

foreign goods
the first and major require¬

is then

for

ment

policy.

foreign

our

This calls for

part. While

measures on our

and

out,

number of
a new

tariff is being worked
should "bind" our present
(in
our
relations
with

low
we

rates

friendly nations) and we should
pass through Congress, as soon as
possible, the presently pigeon¬
holed Customs
We
the

Simplification Bill.

keeping out goods from

are

American

because

market

tariff

rates

not

only

high but

are

for the

Let

and low

excessive

When

tape.

tariff,

amount

get

should

new

use

instrument of trade

negotiation
in order to bring about a reduc¬
tion of trade barriers by the other

third

The

second

major objective of
economic
policy

foreign

our

aspect

attention

our

the

greatly to be

United

hoped

ward for

States

which

been

greatly

concerned

anything
In

the

very

suc¬

the division

tional

world. In

Bank

for

Reconstruction

and

Development, of the activities
the Export-Import Bank, and

certain

amount

private

investment, economic development
of

slower

the

areas

many

than

conceivably

have

world

might

been

abundant supply

Another

has
very

with

of capital.

been the

free

non-Soviet

economic nationalism amongst the

there

governments

best

process

Western

started

two

wny?
the

reasons:

prevalence

underdeveloped

Europe and the Sterling Area. The

countries

United

States

exchange controls.

active

foreign

since

has

really

that

The combina¬

year

at¬

atmosphere

which

the

tempt to restore the convertibility
of the pound sterling had failed

vorable

through bad preparation and pre¬
mature action, and ever since then

developed countries.

have

basic

avoided

objective

pressing

this

foreign

our

vate

ours,

for

have

expanding

world

problem,

our

the

Devastating

Instrument

the

one

struments
ism.

however, is
devastating in¬

most

economic

insulates,

national¬

effectively
than any other device, a country's
economy
from the rest of the
world.
It provides a wall behind
which the country's internal prices
can

develop out of touch with the
of world prices, thereby

ours

much

growth
their

taxes in

growth

don't

masses
to

leads

lateralism

Until

bi¬

Schacht.

Doctor

the

and

problem
to

gain

speed-up

they

very

their

stand

the

them¬

countries

stand

lose

freedom if the lack of

gives

way

discontent

for

funds

could

made

11 i 1 a t e r a 1

m u

private trading and in¬ go preferably in the direction of
enterprise cannot be re¬ countries whose governments have
taken positive measures to attract
stored.
;
: ...; t •
It has been my conviction for private capital.
based

dividual

number

So long as private investors are
that the
Marshall Plan might have become discouraged from going abroad by
a
hostile attitude of foreign gov¬
an instrument of monetary recon¬

the

adopt

case.

Now;

number

measures

This has not, however,

struction.
been

now

are

must

important

ernments, international capital
movements cannot revive. Here is

outlook

wall

which

the

United

States

the

trol.

removal

What

realization
lack

which

stands

the

struggle ahead of

in the

objective of human

Both of these

cohesion

and

unity.

future

effectively

help
by

reserves

with

buttress the position

stick, by rewarding fair treatment
of
private
investments and by

penalizing

acts

arbitrary

presented.

are

15)52

2nd Quarter

1951

1952

3rd Qtr.

1951

*$1.07

*$0.53

*$0.52

*10.79

*10.81

*5.27

*5.41

*5.24

1.94

Ave.

*$0.56

1.61

0.94

0.81

0.85

1.61

Fifth

*$1.06

1.31

0.79

0.71

0.69

0.82

___

Bank

1.95

1.69

0.98

0.88

2.44

2.51

1.21

1.25

1.15

*12.38

*12.87

*6.87

*6.79

*5.74

___

4.92

4.38

4.59

*1.40

0.75

0.40

0.38

2.58

2.40

1.30

1.28

J. P. Morgan & Co._

9.54

7.14

4.62

3.66

5.90

tNational

1.93

1.61

0.98

0.81

0.87

4.28

4.03

2.17

2.08

2.15

1.71

1.90

0.83

1.00

*9.42

*8.48

*4.92

*4.59

*4.38

New

Trust

___

City

York

Public
U.

Trust
Bank

Trust

National
Trust

1.25

the
"■Indicated

able

^Includes City Bank Farmers Trust Co.

earnings.

can

in the above figures the earnings for the third

seen

quarter of last year and those of the second period show consid¬

Americans—and

erable

the

lesson

free

the

world—have
that

nations

learned
all

must

the

The

answer

our

prosper

hands!

variation.

number of instances net

These three

in most

this year

those

over

reflects tax adjustments.

cases

far

earnings for most banks have shown gains
With expectations

1951.

economic

policy

our

are

for¬
very

that results for the third

quarter will equal those of the second period,

Hayden Memorial Golf
Tournament Today
The
den

24th

annual

Charles

Hay¬

Memorial

Trophy Golf Tour¬
nament will be held today (Sept.
18), at The Apawamis Club, Rye,
N.

large

Four-man

number

vestment

teams,

New

from

York

won

in¬

last

resenting

year

team

The

gain for

of institutions

subject

some

favorable

com¬

should

be restricted because

number

82%

any

Others, however, have not reached this point

able to show

On the whole

may

profits taxes which will absorb

excess

increase in earnings.
and

banks

approaching the point where they will become

are

some

gain in net results.

expect the results to compare favorably with

the earlier periods.

was

Joseph F. Whalen Now

rep¬

Merrill

Lynch, Pierce,
Fenner & Beane. The trophy was
donated by the partners of Hay¬
den, Stone & Co. and is kept in
perpetual

Merrill

parison for the nine months is assured.

banking houses will take

part in the tournament which

play

memorial to

Lynch,

Stone

Pierce,
Co.;

Fenner &
Courtney

Keller, Jr., of Blair, Rollins & Co.,

Inc.,
aspects of

earnings declined

although operating results before taxes continued to improve. This

together if we are not to go down
separately in misery and distress?v_

na¬

tionalism.

of eign

also

are

8.86

With Hanrahan & Go.

BANK STOCKS
The

and

William

Rex,

WORCESTER, Mass.—Joseph F.
Whalen

has

tion

with

Hanrahan

Street,

members

Co.,
of

332

the

manager

the

New

York Bank and Insurance Depart¬
ment

for

Co.

manager

and

Frederick
in

the

for

Adams

past was trading

Raymond

now

our

for

investment, dis¬

May,

1952,

Bulletin,

operating:. We direct atten¬
this

group.

Main

Boston

Exchange. Mr. Whalen was

Committee

Arrangements.

associated

become

making: these securities

attractive

cussed

Clark, Dodge & Co., compose the
on

forces

(Special to The Financial Chronicle)

den,

way

compared

are

*2.80

Stock

very

handling the

0.79

disappoint¬
past,

historians

manner

*2.80

ments and frustrations of the

will

the

Manufacturers Trust

freedom.

After

tribulations,

10.10

Hanover

formerly

con¬

Exchange

Guaranty

of the Western World if—and only
if—that world achieves internal

many

periods. For this

operating results have not been published

First National

within the reach

are

earn¬

In addition the earnings for the second quarter

Manhattan

Chemical
Corn

1951

comparable with

major banks in New York City

National

Beane; Wickliffe Shreve, of Hay¬

along that line is the

adequate

•

Europe adroit combination of the
prover¬
bial
carrot- with the
proverbial

exchange
in

■

the late Charles Hayden, founder
of the firm.
Caryl H. Sayre, of

could

which is currently very favorable
to

Bank of N. Y. &

against economic nationalism

war

operating results

Operating Earnings

Bank

win the Battle

higher than warranted

6 Mos. to June 30

to benefit from

Western

period. This

justified because

subsequently approved.

are

break down. It could do

the

Convertibility, there will be

hard

years

will

Chase

Time

Even if

in others,

banks took

some

earnings accordingly.
this increased liability

below, the operating earnings for the first half
16

In cases where

forcefully.
essence.

adjusted

quarterly basis, the indicated earnings

on a

quotas.

were

portion of

coming weeks.

Bankers Trust

import

rates
a

respective periods and for the third quarter of 1951

shown.

these goals are to be reached, we
shall have
to
act
fast
and
act

private capital. Such govern¬

mental

of the

end the wide-"**

use

In the

record that by the end of 1952 we

It is tne

control has been available from time to time to
trade underdeveloped countries should

exchange

eliminated,

direction

the

bringing to

spread

for the

the

is not
Indeed, it is first and

governments of undercreating balance-of-payments dif¬ developed_qovintries which have
ficulties.
And
by appearing to the greatest responsibility in the
protect a country against the con¬ matter and th^ government of the
sequences
of mistaken domestic United States should make this
policies, it
encourages .compla¬ abundantly clear to them and to
cency
towards internal inflation the rest of the world. It should
and the growth of economic mal¬ be made abundantly clear, as the
adjustments. Furthermore, ex¬ International ^Chamber of Comchange control combined with the1 merceurged as recently as last
use of' import quotas-restricts in¬
May that governmental loans or
ternational .trade
and payments grants could never be a substitute
and

last

months and

surtax

to be lower than

and

explanation

the table

Irving

But the problem

and despair.

course

for

and

provision for

cases

feature

with those of 1951,

good opportunity

of the next

normal

and

some

the

restoring currency converti¬
bility in Western Europe in the
course

placed

ago.

respective periods.

1952

that

year

operating statements should be watched for footnotes which

provide

may

tory will then be bright.
Prosperity is a wonderful ob¬
jective. Even more wonderful is

the

very

early

persuaded

not

the actual tax liability incurred in the respective
reason

—but the chances of eventual vic¬

Thev

for

countries

underdeveloped
selves.

stake in

conducted

very

higher

A year ago Congress was writing

which the

ings to make quarterly operating results

alone.

foremost

should

It may be that some institutions will adjust their

what has

for the past quarter

has

emphasis

third quarter of a

consideration

reviewed in

nations

Europe

summer

into

retroactive

the

by Communist bland¬

astray

ishments.

control,

Exchange

led

The problem

^satisfied

underdeveloped
Control

under¬

economy.

too.

pri¬

the

unfa¬

most

expansion

investments

want

policy.
Exchange

prevalence

policy tion of the two has resulted in

monetary

1947.

had

the

and

ern

now

These factors should be kept in mind when

for

could

This

world.

And

under

earnings in

are

of the world,
unity of us all.
comprehensive tour of West¬

yes!

much

because of the increase in taxes

and for the
A

law

prosperity and for that of the

other

too

caused

national monetary system for our
own

cases

however,

year,

in the third quarter and had to absorb it in the final

century,
our
foreign
economic
policy must be acutely aware of
the importance of a sound inter¬

frystration?

Indeed,
Essentially for

with

contrast

are

computing results for the third quarter,

fact

it creates in the free

case

and operating results

year

Others, however, made

against economic nationalism and

cessful operations of the Interna¬

last

some

year.

Earnings have been trending up¬

by tax considerations.

tax

this

that, unless we open our market
more widely to foreign
goods, we
hoped-for are incapacitated in our struggle

spite of the

third quarter

the year.

the realization

in approximately

same

increased from 47% to 52% and made retroactive for

over

based

the

comparisons with the

new

program must be a deliberate and

program

over

distorted

in¬

have flown concerning the "Point
Four" program.
And yet capital
movements have not been revived

published

period which ended with Sept. 30, 1951, operating earnings were

the

bold attack against economic na¬
encouraging private tionalism, both our own and that
foreign investments. Rivers of ink of other countries. It must be a

methods

with

Nevertheless,

that

will

level.

exact

of 1952 to

expected to be about the

Comparisons

New

Administration

new

convertible currencies throughout
the largest possible part of the

for

quarter

are

should be relatively favorable.

our

The UrS. Government has

years.

should be the re-establishment of

Program

third

weeks

slightly better than those of earlier periods this

foreign
augurated
in January will put
economic policy: the problem of
high on its agenda the formulation
foreign
investments.
Much
has
of a comprehensive program for
been said on this subject in recent
a
foreign economic policy. This

been

free countries of the world.

two

Administration

now^turn

well

the

extent.

red

not

the tariff involves many elements
of arbitrariness and of
uncertainty,
as

West¬

Foreign Divestments

also because the administration of

program.

economic

friends

our

comprehensive, many-faceted,

the

American market to

Bank Stocks

—

Operating earnings of the major banks throughout the country

Europe first, elsewhere after¬

ern

JOHNSON

commercial policies

chronic

be regarded, as it sometimes
is, as an alternative way of re¬
foreign countries to expand their wards. It would
be tedious, at this solving the "dollar gap" problem.
production and trade. Because it
Capital exports are not a substi¬
point, to go into a welter of tech¬
favors both our own prosperity
tute for merchandise imports. If
nical detail. Let me indicate, how¬
and that of the rest of the world,
our foreign loans and investments
ever, my personal conviction that
I should regard this as a good
are to be secure, we have to
accept
the solution of this problem calls
solution.
for a major upward revision of foreign goods and services more
abundantly than heretofore.
the world price of gold, as a part
Tariff Policy and Procedure

can

reconstruction

ties for

fund

reserve

the

tied

monetary

gap"
balance-of-payments difficul¬
foreign countries. The re¬
of
sub¬
vival of foreign investments must
make it

We must design a

which

program

closely
have

but

so,

maintain the prosperity of our
industries while allowing

are

convertibility

Together with Switzerland and

for the goods they
buying from us. This solution
pay

once

of currencies has been restored.

(1039)

& Co.

Laird, Bissell & Meeds
Members New York Stock Exchange

Members New

York Curb Exchange

120 BROADWAY,

NEW YORK 5, N. Y.

Telephone: BArclay 7-3500
Bell

Teletype—NY 1-1248-49

(L. A. Glbbs, Manager Trading I>ot.i

Specialists in Bank Stock»

The Commercial and Financial Chronicle...

(1040)

Continued

from first

Thursday, September 18,1952

American

page

trade policies. ^ Maybe
simply follow the apparent

they
State

Public

Utility Securities

"Trade, Not Aid?"
tariffs serving as excuse for in¬ petition, as
hypothetical
flating wages and farm prices.

By OWEN ELY

San Diego

Gas & Electric Company
Diego and

Gas & Electric serves the City of San

San Diego

environs, about two-thirds of revenues being from sale of elec¬
tricity and one-third from natural gas. Electric revenues are about
45% residential and farm, 29% commercial and 21% industrial.
About 54% of electric and 69% of gas revenues are derived within
the City of San Diego, which has a population of some 334,000.
The service area includes the permanent U. S. naval base and some

industrial activity, principally aviation

citrus fruits

generated by steam units, with a

Most of the electric output is

«mall

Grain and

manufacturing.

the chief agricultural products.

are

from Southern California Edison or
About one-third of generating capacity is more than a

amount

others.

purchased

largest stations (66,000 capacity each) were
1950, and another of the same size is being
Generating plants burn gas or fuel oil.
Natural gas requirements are obtained from Southern Coun'ties Gas Co. under contracts calling for delivery of 73 million
cubic feet per day, which have about seven years to run. Southern
Counties obtains less than half of its gas from California fields,
the balance being from out-of-state sources under contract with
d Paso Natural Gas. Fuel oil is purchased by San Diego from the
Union Oil Company, the price for 1952 being $1.91 compared with
$1.60 last year; however, the higher price does not seem important
<rom an earnings angle.
C'
The company has enjoyed rapid growth, revenues increasing
€rom less than $11 million in 1941 to nearly $33 million recently.
.Share earnings up to this year, however, have remained compara¬
tively stable within a range of 810 (1947) and $1.19 (1950). The
dividend rate was somewhat irregular in 1941-43, but since 1944
lias remained at 800.
The common stock has also been quite stable
In recent years around the 12-15 level; during 1945-47 it sold at
•somewhat better levels, with a high of 19% in 1945.
Earnings this year have advanced sharply, reaching $1.33 a
share for the 12 months ended July 31.
Chairman Klauber, in his
^recent talk before the New York Society of Security Analysts, esti¬
mated that the figure for the calendar year 1952 might improve
Curther to around $1.35-$1.40.
This increase, however, is con¬
sidered to be due in large part to higher leverage resulting from
increased debt. The capital structure is currently as follows:
(decade old; the two
Installed in 1948 and

Installed currently.

Millions
Funded

Debt

Preferred

Common

Percentage

$38

Stock

41%

Total

$92

100%

equity
According to Chairman Klauber the company may do equity
financing late this year or early next year, and after such dilu¬
tion 1952 earning power might approximate
$1.18 on the in¬
creased shares, he estimated.

'ratio.

considering the fact that its

power

Is steam-generated.

Residential revenues in 1951 averaged 2.400
The only rate increase obtained by the
company in the
postwar period was an increase of about 7% in gas rates in
May,
1950.
If the company is required to meet
any substantial increases
in costs of the operation of the electric
department in the
per

KWH.

future,

it might apply to the California Public Utilities
Commission for an
electric rate, increase,
according to a statement in the bond

prospectus.
Mr. Klauber has estimated that the
company is currently earn¬
on the electric rate base and
7.8% on gas, or an
overall return of about 6%. Next
year, with

ing about 5.5%

higher costs, the aver¬
drop to around 5.6%. However, it seems un¬
likely that the company will ask for a rate increase next
year,
despite the fact that a somewhat higher
average return would
age rate of return may

seem

warranted.

whi,ch,is traded over-the-counter

yield 5.3%,
fifth

largely held in the service

owned outside the State of

Indication that the dividend will be

Israel & Co.

Offering
Capitol Hill Oil Slock

Israel & Co.

area.

California.

around

Only about

There is

one-

present

increased.

Luke J. Murphy
Luke J.

That is where the Welfare State

the former.

comes
in. It says, in effect, that
is supported by
there must be no risk, no loss of
reference to the example set by
income either to the

The

argument

Britain in the 19th century. While
she was the leading creditor coun¬

are

offering "as

issue

common

dent of The Public National Bank
& Trust

Company of New York,

Whitney Opens

BOSTON, Mass.

—

Stephen

—

Robert

produce the dollars

abroad?

Let

recall at once that not all for¬

eign

countries

boat,

are

the

same

not

by a long shot.
Even
Europeans, quite a few
gaining gold if only at the ex¬

among
are

of their neighbors: Belgium,
Norway, and Germany.

pense

Holland,

that

Note

these

ures

reduce

to compress

centives

nations

strong

welfare

meas¬

subsidies,

credit, to provide in¬

for

dollar-earning

ex¬

to liberalize foreign trade,
a
matter of fact, about

ports,
etc.

the

are

which have instituted

three-fifths

deficit of $4

accounted
and

Area

the

outer

billion last

for

the

wealth.

They

children

the

French

world's,

year

was

Sterling;

Common¬

the problem
international fi¬

are

our

nance.

Take Britain

Her

may

the focal point.

commodity exports have risen,

gain

consum¬

1846, when the "Corn Laws" ers of cheaper cheese, that much eration). The trouble is, one trou¬
abolished, France, the Ger¬ or more we lose as taxpayers by ble, that simultaneously her im¬
man
Customs
Union,
the Low footing the subsidy bill. Instead ports went up from around £1
Countries, etc., were on, or soon of providing sound incentives for billion sterling to over £ 4 billion.
Her
turned to, free trade. The Ameri¬
deficit has trebled,
partly
mobilizing our resources in the
can tariff did not amount to any¬
offset by a tremendous increase
most
efficient way, Free
Trade
were

Every commercially rele¬ under the Welfare State indirect¬ in invisible trade such as shipping,
globe was free ly helps to freeze them where and tourist traffic.
from protectionist excesses.
Now then, the American tariff
The they are, or actually to shift them
Open Door prevailed; the princi¬ into still less efficient occupa¬ surely cannot be indicted for the
decline by more than one-third of
ple of nondiscrimination was uni¬ tions.
British
exports in the categoryversally accepted.
Far be it from us to advocate
"raw materials and articles mainlyPresently, mankind lives behind protectionism! But from the point
unmanufactured" <—mostly
coal.
Closed Doors. Not a single coun¬ of view of social
economy,
not
try is left without towering tariff from that of vested interests, Free Output restrictions by the gentle¬
walls, most of them higher than Trade under the Welfare State men-miners, combined with a
greatly
increased
domestic
de¬
ours.
American trade policy is
pays no dividends. It may be cost¬
mand for coal, are to be blamed.
just about the world's most lib¬ lier to society to have cheap
Nor has our tariff anything to.
eral. Our reciprocity policy is the
cheese than to cut out its
imports

one

major force driving in the di¬

rection of
the

last

altogether.
In fact, the cheaper
(At product must be costlier when

moderating tariffs.
G.A.T.T.

conference

and R. H. Johnson &
Co.

do with the insatiable British

de¬

mand for
due

imports. Partly, that is
higher exports, and to a

every loss caused by competition
moderate
extent, to armaments.
to any influential group automat¬
automatically ap¬ ically sets the apparatus of wel¬ However, the British derive somecompensation for their armament
ply to Britain; she reciprocated fare-spending into motion.
costs from our off-shore purchases;
with—none.)
But excises levied
The protectionist himself has a
and from the lavish spending by
on imports constitute a minor ele¬
case.
He can argue that
when
American troops abroad.
In any
ment in blocking and distorting
income distribution is determined
case, the additional need for raw
the traffic.
"Quantitative" con¬
by political fiat, when his labor
trols, preferences, exchange ma¬ costs per unit of output are being materials so far does not amount
nipulations, bilateral and "bloc raised out of proportion to labor to much.
Also, it could be pointed out
buying" practices, governmental- productivity, "free competition"
that the American tariff is not
ized cartels, and a host of subsi¬ with
foreign producers is a farce.
dies do the real job.
In these He can claim that he pays higher responsible for the decline of Eastrespects, Switzerland is the one taxes than the foreigner (which West trade, or for the fact that a
substantial portion of British ex¬
country in Europe whose policy is difficult to
prove or disprove)
ports is of the "unrequited" type:
is almost as clean as ours, which
and is, therefore, entitled to have
paid in sterling balances or not
is far from being entirely clean.
his profits (or what is left of them
paid at all—legitimate capital ex¬
As it is, the tariff is prohibitive in
after taxes)
protected. Why, in-,
ports and illegal capital flight.
few cases only; it is doubtful that asmuch as

Torquay,
cessions

made

some

120 con¬

which

further

reduction

could make
ence

the

its

rates

meant

economies.

burden

the equalitarian Wel¬
great deal of differ¬ fare State, is it not fair to receive
volume of imports,
some benefits, too?

theory

Nance has become affiliated with
T. A. L. Albee &

doles

generous

some

miracle the American tariff would
be done away with: would that

kept her foreign trade be put on WPA projects. The ex¬ from about £600 million sterling;
per year before World War II, ta
impediments. Now that cess milk of the
dairy farmers
some
we have taken over the lead, is it
£2,700 million currently,
must be bought up by the Depart¬
not the logical thing to follow the
just about in proportion to the in¬
ment of Agriculture; maybe they
crease in world trade
same pattern?
The answer to this would
(taking theget RFC loans to produce
pound devaluations into consid¬
alleged historical parallel is that more. What we

was

Co., Inc., 4 Liberty
Whitney is engaging in the securi¬
Square. Mr. Nance was formerly
ties business from offices at 53 with Boardman &
State Street.
Freeman, Inc.

get

Suppose, however, that by

she

try,

Mass.

would

workers

us.

free from

stock

BOSTON,

The

employees.

he carries the financial

Murphy, 69, Vice-Presi¬

(Special to The Financial Chronicle)

S. T.

entrepreneur

re¬

inexhaustible

"emergency" is good enough
us, and never mind the cost

for
to

gratifying to see
Suppose that Danish, Dutch and
Europe's thoroughly restrictionist
Swiss producers offer blue cheese
statesmen
return
to
"classical"
on the American market at lower
economics. Some may believe in
than Wisconsin prices and/or in
it literally; there is a strong cur¬
superior quality.
Normally, this
rent at least in Belgium and in
would help to raise our standard
Germany. But the majority inter¬
of living. Capital and labor would
pret it in a specious way. What
be drawn out, or kept out, of a
they have in mind is a lop-sided
nonremunerative business and in
free trade: they shall keep their
due course canalized into
more
own
barriers—tariffs, import re¬
profitable lines. Society as a whole
strictions, exchange controls, dis¬
will have gained, although there
criminations. The appeal for free
trade is addressed to Uncle Sam, may be losses on investments and
temporary unemployment, as must
and to no one else.
occur in risk-taking ventures. The
The argument is very simple.
losses would soon be wiped out;
America being the country where
what the consumer saved by buy¬
dollars grow, how could the outer
ing foreign cheese, he would spend
world earn them except by selling
presumably in buying more of
goods and services to America? other American
goods and to ar¬
This is an adaptation of the old
gue otherwise is to deprecate the
and respectable thesis that a
ability and ingenuity of American
debtor nation cannot pay its cred¬
business.
itor unless the latter buys from
be

though the profits of the impor¬
at Mount Vernon
a died
Hospital
ters would be favorably affected.
300,000 on Thursday, Sept. 11, after a
long
(par 10 illness.
n
cents) of Capitol Hill Oil Corp. at
Mr. Murphy was
widely known
We are asked
$1 per share.
to
establish
a
and had many friends in
banking
It is intended to use the net
caricature of free trade by elimi¬
circles
throughout the country.
proceeds to drill a test well in the His
banking career covered a span nating the tariff without reciproc¬
IWarshall County
ity of any sort. The request im¬
Prospect in Mar¬ of 55 years.
Starting with The
shall County,
Okla., and if well is Western National Bank
plies a left-handed compliment,
of
the
commercial producer to
namely, that we are a nation of
equip said U. S. in New York in
1897, which
well. The remainder of the
idealists
(a term with sarcastic
pro¬ later merged
with The National
ceeds will be added to
connotations), leaving us no choice
working Bank of Commerce in New
York, but between
capital.
he remained with the latter in¬
providing unilateral
Capitol Hill Oil Corp. was or¬
stitution until 1923! He was asso¬ free trade or free handouts, with
ganized in Delaware July 24, 1952
the further implication that Eu¬
ciated with The Public National
for the purpose of
rope
itself cannot do anything
exploring for Bank for 23 years.
and oil and the
more about its own
development
His son, Walter E.
plight. Nay,
Murphy, of
of likely gas and oil
we
will be held responsible for
prospects. New
Rochelle, N. Y. survives.
The corporation has
its plight unless we open our al¬
acquired oil
mid gas mining leases
covering
legedly "locked" doors. But the
Joins A. L. Albee Co.
sipproximately 1,060 acres.
classical free trade

-speculation"

shown by a
fictitious)

not

illustration.

Europe of its

dollar

vant corner of the

At the end of last year the equity ratio was 41% but the issu¬
ance of $12 million bonds in April this
year reduced the

San Diego's rates are low

(but

that any¬

thing.

Stock

would

lieve

can

Department line:

thing that is good enough to

apply

never

managed
In fact, Welfare State

and Free Trade are

com¬

of
payments,
not
just
against the United States, is the
crucial point. In 12 months' time,

At any rate, abolishing or even
the Sterling Area account with the
reducing the tariff, in the face of E.P.U. went into the red to the
the damage to private interests, tune of
$900 million. Note that
has no justification except in Britain
enjoys the
preferential
terms of economic gains to soci¬
tariff rates within the Empire and
ety. But those gains are bound to that her exports are boosted with
be wiped out when income dis¬ the aid of
"cheap" (transferable)*
tribution and resource allocation
pounds, barter and clearing agree¬
are not
determined by the rules ments and similar bilateral tricks.

of the free market.

That free

trade

lated market
should
for

are

with

she

percentage-wise,

Yet,
and

loses

manipu¬

ground in most export markets of

not comptatible,

the world. Between 1929 and 1951,.

be obvious.

services

The

rendered

pays

her

accord¬

ada

tumbled from

one

in the imports of Can¬

15%

to 10.3%p

the in the East Indies from 42.4% toconsumer's appreciation; the other 18.2%;
in France from 10% to
according to some ideas or ideals 3.6%; in the U. S. from 7.5% to
of equalizing incomes or stabiliz¬ 4.2%
(while our total imports
ing them, or simply to do favors have risen nearly three-fold, to an
to pressure groups.
all-time record of $11 billion); in
ance

sad

competition

and

commentary it is on the

intellectual

integrity of
the crypto-liberals that while they
are planners and socialists of "one

mutually ex¬
clusive concepts. Welfarism, with
its arbitrary dictates over the al¬ sort
location of resources, rules out fairs,
the benefits of international

Worldwide deficit in the British

balance

state

another

they

laissez-faire

revert

when

domestic

suddenly

comes

af¬

Brazil

from

19.2%

Instructive is the
cotton

10.2%, etc.

case

goods exports.

of British

In volume,

they have fallen since 1938 actu¬

ally by two-fifths, not just per¬
centage-wise. This, too, has little
more

than nothing to do with our

yolume J.76

Number 5152

...

The Commercial and Financial Chronicle

tariff that,

in the meantime, has upperhand. Thus, it follows from even better position than hereto¬
appreciably • reduced. Here the false premise—that the tariff fore to displace the sale of British
what it has to do with, in the is the guilty party—that Britain
goods in third countries.
words of
an
English economist, has to be the sole beneficiary of
Thirdly, with all due respect to
Professor
Ely Devons ("Lloyds a world-wide trade liberalization, the anti-protectionist sentiment of
Bank Review," July, 1952):
"A while her own trade should not genuine free traders: the attempt
new feature of international trade
be liberalized at all: global dis¬ of
Keynesians and Fabians to shift

fashioned

been

cotton

goods—although there
some signs of it in the 1930's
the development of a sub¬

were

•—is

stantial
the

export trade

India is

now

keen

Balkans.) That
might help, provided the imports
the

Kingdom

lar

the United

little

is not

the

time

and

place

Shortage?

difficulty in
competing with the United States
in world markets for cotton
goods,
United States exports were
practically limited to countries,

such

it is one factor among

the

and

But now

about

this

the

are

supplied

three-quarters of

increased

while

Canadian

imports

United Kingdom are
only 6% of the total.
cult

long-run

the

factured

marily

tell

how

the

portance of

International

spell

it out bluntly (in selfagainst the pressure ex¬

by insolvent nations for
dollars) that the policies
practised by many countries try¬
more

ing to live belond their
"bound

sooner or

trated."

Dollar

means are

what would

happen to us all. This strikes us as utter
strong Republican Administration repre¬
sented at both ends of
Pennsylvania Avenue by men and
women
really determined to clean house and without
sympathy with the sort of character assassination withfc

later to be frus¬

shortage

worst)

silent

are

consequences

achievement

their

manu¬

products (the ones pri¬
affected by the tariff)

Lastly,
that

financial

European

scarcely

possible*

politicians

should

believe in the likelihood of
ical tariff reform

knowing
it is

which Senator

McCarthy is charged would, obviously it
a much stronger position to deal with
the situation than
any Administration of which such mem¬
bers of Congress are in the
opposition party—as has been,

rad¬

in this country,
the vested

ma¬

terial and emotional interests built
up

protectionism.

purpose

of their

The

the

chief

"free trade"

deflate

the

diffi¬

Continued

virtual

disappearance of the United King¬
dom
from
this
most
important
market is due to price differences

British

exporters

deliver

More "Americanism" Needed
Of course, we
may as

earnestly wish that

tively with the
such

market

there is still

United

States

determination to reestablish Americanism in this
country
of ours. In the sense that
apparently the leaders of both

parties and all the candidates, either expressly or by im¬
plication, have revealed themselves as victims of the
economics" school of
propaganda, they are all
largely "me-too-ers." We should be much happier if we
could find in any of them
any genuine devotion to real
liberalism. That we do not find, but we should
greatly
fear that a wave of public sentiment
against the Mc¬
Carthys and the Jenner^ would tend to get in the way
of such reform as
might otherwise be effected at this time-

The "Mess" Is Real
The

danger is that if McCarthy ism (with which as
such we, too, have little patience) and
repeated denuncia¬
tion of it is permitted to dominate the scene, the terrible
venality, corruption and treason which have made and
make McCarthyism possible will be overlooked or at most
take a place of secondary importance in the mind of the
public. Something of this sort is what appears to have
taken place in the campaign four years ago. There are a

Canada, where
tariff preference in
as

favor of British cotton goods, the

prospects of her being able, with¬
out special
in

other

such

protection, to compete

markets

Japan

with

and

prices for cotton goods
lower

than

States—is

those

perhaps

gloomy than

countries

India—whose
United

is generally

recog¬

Britain's equi¬

for

librium

the

assurances

this and certain other somewhat less

give thanks.

rank

and

file

Wisconsin

that

the

"mess"

most

we,
along with a great many others,
prefer to do without either, but if we must
choose we think a real clean-up in
Washington is infinitely
more
important than the slapping down of what is, after
all, a rather small figure in the State of Wisconsin. And,
of course, the clean-up in
Washington should go much

seems,

the export mar¬

Germany takes

growing

share of trade in Europe and

be¬

yond; Japan in Southern Asia and
in Africa; the United States
in
Canada and Latin America.. Why
'is Britain

falling behind, compara¬
tively speaking, except in a few

countries

such

and

Denmark

discharge of individuals or groups here
and there who have been guilty of misconduct. There has
grown up in Washington a hierarchy, partly New Deal
and partly Fair Deal, which not
only has in its midst
unscrupulous men, but has nurtured many, many men
who either are ignorant of American tradition and the
American way of life or are wholly out of
sympathy with
them. Among these, possibly predominant
among them,
are individuals and
groups who, as Mr. Eisenhower has
said, have not only proved themselves "too small for their
jobs," but "too big for their britches," and in addition
have been in Washington
long enough in many instances
to develop a very high degree of confidence in their own
ability and ultimate wisdom.

"Australia?
The British like to lament about

the

loss

their

ments

and

tional

compared

foreign

invest¬

the

physical damage
.they have suffered; both are frac¬
Germans took
ain lacks

with

what

the chin. .Brit¬

equipment, they

do, and much

the

say;

Germany
and Japan; besides, the latter two
received only a small fraction of
the
American
postwar benevo¬
lence.

so,

Their wage rates are lower
those on the British Isles;

than
which

lag

even

wages.

true,
more

Evidently, this competitive

weakness

one

The conclusion
absurd

tariffs

obstructs

ain's
of

the

which hits

it is

inescapable.
hurdle

restoration

that

of Brit¬

solvency—all trade barriers

all

countries

scrapped,

ought

excepting those of the

United Kingdom itself. Even

American,

German

competition

may

and

still

There
not

many degrees of un-Americanism which do
the point of treason. Doubtless many men

then,

Japanese

have

the

being is shot through with New Dealism, Fair Dealism, and a dozen other notions alien to our history, our
traditions and to any solid foundation upon which this
country can erect a sound future, are as sincere in their
beliefs as are we in ours. Others are probably what might
in

a sense

R*prrl

of Governors

System

cvf the

Sept.

suspended Regulation X—Real

Estate Credit—in connection with
its announcement of a period of
real

estate

tion

credit

control

prescribed

Amendments to
duction

Act.

relaxa¬

the

1952

the Defense Pro¬

The

suspension

be termed "career men" whose minds and better

judgments have suffered damage from too close contact
with pseudo-liberals who are convinced that whatever is,
is wrong, to misquote the poet. And, of course, there is
the un-Americanism which takes the form of plain old-

Regulation

X, effective Sept. 16,
applies to credit terms on

1952,
both

both residential and

non¬

residential

and

gage loans are,

ject

State

and

Federal

governing
real
estate
loans by financial institutions.
The Board's

action

relates only
to real estate credit not insured or

seasonally adjustedi
1,200,000 units. In¬

formation has been received Irons,

the

Secretary of Labor that the*
seasonally adjusted annual rate o#
housing starts, as estimated for
this purpose, was less than 1,200,—
000 units in each of the months o*

June, July, and August, 1952.

Washington Dodge Dir.
Washington Dodge, well-knowi*

of course, still sub¬

basic

below

annual rate of

nonresiden¬

statutes

■

statutes.

starts for three consecutive months*
were

tial properties. Conventional mort¬

writer of economic articles and

partner in the
York

New

Stock

Ex¬

guaranteed by the government. A

change firm of
Roberts & Co.,

statement on terms that will

apply

has

estate

elected

aided

government
is being

credit

real

issued

separately
by the Housing and Home Finance

Administrator, Raymond E. Foley,
nouncement.

are

reach

Thp

Federal Reserve

who concurred in the Board's

whose

that emerges is

constitute the

Much to Clean

cannot

country

foe caused by our tariff
the others equally.

mere

but they in turn
behind American

terms

residential properties, but conventional mortgage loans remain

course

further than

Suspends Regulation X

Suspends control of credit

subject to State and Federal

would much

Inexorably, it

assurances

news as this than most of what is
being said
day to day about McCarthyism—and we believe that
of the American
people feel the same way.

Federal Reserve

tive

situation

precise

part, would much rather

our

hear such
from

character "assassination."

kets of the world.

We, for

is dark, indeed.
A most
threatening aspect is the competi¬

Washington has done, is doing and will continue to do, if
not eliminated, a great deal more harm than so-called

IV
The outlook

and

take into pleased consideration

we must

that have of late

come from the
Republican
headquarters that real effort is to be made to reduce
Federal outlays and hence the burden of taxation. For

should certainly hope, that the balloting in
that State for the most part reflects a
feeling on the part

pose,

nized."

Meanwhile,
the

great many who profess to be wholly unable to understand
what happened in Wisconsin last week. We should
sup¬

much

are

the

even

well be candid and say that we
could find in either party any real

"welfare

We See

cot-

goods of the right style and
quality promptly. If the United
Kingdom cannot compete effec¬

heretofore.

case

domestic

compared with the United States,
and how far to the
inability of
Ion

be in

ar¬

from first page

to us,

seems

they do how difficult

overcome

nonsense.

the

(1951)

now

far

by Senator McCarthy in no way lessen the im¬
a house cleaning, and to the further fact that
regardless of the McCarthys and the Jenners it is still
good policy to select the party and the candidate most
likely to undertake and to give thorough practical effect
to this house
cleaning. There are those who seem to sup¬
pose that should McCarthy and Jenner return to Wash¬
ington as members of the party in power rather than as
part of a minority party, then — well, the Lord knows
excesses

Board

thing wre hope is that the results in Wisconsin,
the rank and file elsewhere to the fact that

arouse

and

import

from

even

the

gument is, I suspect, to divert
prices public attention from their own
nefarious
costs, and tobfiiicrease there¬
policies, to pave the
by America's competitive power way and to provide fresh ammu¬
abroad. Given the flexibility and nition
for
the
real
"shooting,"
adaptability of our enterprising with a new formula for handouts
system, it might then be in an the ultimate goal.
tends

the United States less than onethird. Since 1948 the United States

trade,

(or at

fective, duty-free import of

Before
the United Kingdom
sup¬
over
one-half of Canada's

imports of cotton piece goods and

has

behalf

striking example of objective would bring about: If ef¬

change is in Canada.

much

best

argument

the

which

widespread.

most

war

plied

First,

apropos.

attack—on

others.
Secondly, the champions oft the

anti-tariff

"The

time,

body
Directors of

Europe—against the American form the unavoidable
ignores its relative unim¬ frustration takes.

special circumstances in her favor.
much more

may

concerted

portance.

the

United States exports

this

official

tariff

Philippines and Cen¬
America, where there were

tral

perverted and befuddled eco¬

nomics.

the question: why Dol¬
But a few closing

reopen

remarks

Another
will

erted

This

cleaning house.

the American tariff smacks of es¬

defense

prising. Before the

war

United

appre¬

had

Monetary Fund feels constrained
not to discard diplomatic courtesy and

keep out-rising its exports.

America.
The continued strength of United
States competition is more sur¬

Kingdom

permit other matters to turn their eyes from this need

plight on

own

the Nazis set in the

com¬

petitor with the United Kingdom
most Colonial Empire markets
an

blame for Europe's

results in Wisconsin
may be taken as an indication that
the citizens of that State at least are determined not to

capism—from the results of their

dealings with commer¬
cially dependent countries like
Denmark, following the example

and Brazil has captured
ciable trade in South

the

bilateral

and Brazil, and the continued high
level of exports from the United
States.

coun¬

(Which is precisely the pol¬
icy London tries to put over in

India

one

try!

some

countries such

newer

crimination in favor of

dishonesty and corruption. All of this needs
earnestly hope that the primary

to be rooted out—and we

(1041)

an¬

| I,
first issued in
■

Regulation X

was

October, 1950, under authority of
the

Defense

1950

and

providing

Production

Executive

for

Act

Order

regulation

10161

real

estate credit terms to restrain in¬

flation

and

needed

materials.

conserve

defensewas

pended in view of mandatory
visions
to

the

These
a

the

1952

Defense

Amendments

Production

amendments

required
period of residential credit

trol

relaxation

estimated

sus¬

pro¬

Act.

announced

residential construction

director of
Colonial

Sand

Stone

Co.,

Inc., it was
announced by

Anthony Pope,
President. Mr.

Dodge
a

also

director

several

other

Washington DoJgo

companies, in¬
cluding A. G. Spalding & Bro^
Inc., and Henry Holt & Co.

With Waddeil & Reed
(Special to The Financial Chronicle)

that
con¬

been

GORHAM,
Brocato
Tnc.

Maine — Samuel AL.
Waddeil & Reed^

is with

The Commercial and Financial Chronicle

(1042)

Mutual Funds

JOSE, Calif.—Joseph Fa-

E. F. Hutton &

"With

the

By ROBERT R. RICH

day ended its three-day session at New York's Hotel Statler
with the discordant notes of Donald C. Cook's morning

the

of the dealers.

doalor

your

bad

told his audience

news

Now York 5, N. Y.

(1)

practices

Bad

t'nnHc

havp

QPllinfT

nafpH

mutual

plim-

hppn

nnt

contains

It is the hope of the SEC that

rule

permitting the distribution

without

of articles,

prospectus

and

brochures

might

pamphlets

entirely replace the interpretation
the

contained
Such

rule

Cashion

letter,

permit,
subject to appropriate conditions,
a

might

also

advertising that such publications

GENTLEMEN: At
■M a

jNEWYORKi|

obligation please send

prospectus on

like)

were

certainties of life."

Canadian Fund, Inc.

Address.

Chicago, for
forming the new company. Previ¬

If Mr. Adams' statement means
anything, it would mean .that the
funds are charged with the responsibility of making a financial

investigation of
holder,

share-

every new

problem that is certainly

in legal twilight. There is also the

The SEC is

all

now

open-end investment com-

panies and their underwriters, as

most

of the

one

effective sales

and

original

the fund business

aids put out by

long time, has just released
for investment dealers Jts "Finan¬
in

cial

Portfolio

Records

Com¬

In this 62 page' book,
FundYpresents the op¬

panies."
Chemical

and financial po¬
sition for each year from 1929 to
1951 for the 45 companies whose
record

erating

subsequent

annually

$100

The amount and fre¬
quency of the investments may be
changed
at
any
time
without
penalty to the purchaser.
payments.

received

distributions

Cash

Knickerbocker

the investor on his

at his option, be

Fund shares may,

automatically reinvested in addi¬
tional shares of The Fund.

A saleman's

THAT

ownership of mutual fund shares
will increase his own sales effi¬

Distributor's
Group an¬
would allow dealers

ciency,

nounced, it
,

the

entire sales

any

Funds

charge

for his

salesman

shares
Inp.

Securities,

:Group

purchased by

dealer or >a
investment.

own

The letter to dealers states that

CHEMICAL FUND,

the Chemical

Fund

"our

objective

salesmen

your

forceful,

distributors

productive

help.

mutual funds."

This, action

influenced ;; b.y

was

the

preliminary results of a survey
of securities salesmen which the

firm is

conducting to ascertain the

degree; of fund ownership by fund
salesmen. The offer is open for the
balance of this year.
A

NEW, 2 color folder "11 reasons

'
h
for
investing irj Knickerbocker"
chemical has been prepared for dealer use
company includes the capitaliza¬
by Knickerbocker Fund.
;
tion, the products manufactured,
Written in
non-technical lan¬
the
operating record
(including guage, and using a combination
net sales, net income before and
text and pictorial treatment the
after taxes, earnings
per share, folder describes the purposes and
dividend
per
share
and 1 price operations of the fund.
The fund's new share accumula¬
range) and the financial position
(including total assets, fixed as¬ tion and distribution reinvestment
sets, current assets broken down plaps are also
outlined' m the

The

further question of how much
responsibility a mutual fund or
dealer should assume, after the
risks of equity investments are
made clear, in dissuading an in-*

JAiyiN,Bp£LOCKiW

department
Hutchinson & Co.,
11'years prior to

McMaster,

whose funds are no more than

available, he said.
(4)

STREET

of the Canadian

ager

authority on Can¬
industries, was man¬

its

and

widow
suf- shares are
ficient to provide against the un- portfolio.
old person in dotage or a

preparing a
questionnaire which will be sent

iaA

WALL

the

and

pamphlets

ONE

not sold to such

shares are

pers0ns or to others whose surplusmisleading lunds are too limited to warrant
material, in spite of the progress their assuming the risk inherent
which has been made in the po- in the
ownership of mutual fund
licing
of
the
investment com- shares." The "such persons" Mr.
panies' sales literature.
Adams was referring to were "an

(3)

^"It i^th^dutv

Sales literature still all too

(2)

Thursday, September 18,1992

CONVINCED

Mr. Long, an
ada

of the
treal, Canada.
Securities

declared that, It is the duty
of mutual funds to see to it that
^

their

frequently

States."

Convention

Annual

35th

National Association of

our organ¬

ization is the only one of its Kind
in the United

Cook, Chairman of the ary policemen for the SEC.
,
Commis^Clarence H. Adams, in an ad- ously he had been associated with
mixed sparse praise with dress two weeks ago before the Royal Securities Corp., of Mon¬

sion,

f»foW»»W 1930

auxili-

an¬
new

Securities and Exchange

RESEARCH CORPORATION
•

mutual £und;

not for the

funcis were hardly

j.ba{.

that:

NATIONAL SECURITIES

120 Broadway

ringing

of many

Mr.

Approximately $4.12 per share
Prospaciut from

still

speech
ears

Bi^HR
\r.

Wednes¬

said in
of the

"We believe

company.

The fourth annual Mutual Fund Conference

SPECULATIVE
SERIES

this

needed by larger groups of in¬

vestors," Mr. Long
nouncing formation

SEC Strikes Harsh Note at Conference

NATIONAL1

interest

growing

investments

Canadian

Davies & Co.

local Manager for

pri¬

country, more specific information

Company, 28 North
was
formerly

Street.

First

and to

funds

investors.

vate

bretti has become associated with

investors

American

institutional

(Special to The Financial Chronicle)

SAN

Canada

Now With E. F. Hutton

into

report

total

each

cash-and-se-

then

and

liabilities
capital).
Copies

folder.

^ ■■

and

current

curities,

NATIONAL

seeking t'o
dealers, on the nature and
vestor
from a
decision
he. has available to investors and invest¬ determine the basic housing needs
scope of the practice of allotting
made on the basis of complete ment dealers without obligation and preferences of couples look¬
brokerage commissions to dealers
in investment company securities, tacts. One dealer wanted to know from Chemical Fund, 39 Broad¬ ing forward to retirement is being
launched this month by Investors
Mr. Cook spoke at length on the ^ mutual funds were a rationed way, New York 6, N. Y.
• ;
Diversified Services,
it was an¬
"obvious dangers" in the practice commodity, available to some and
FOR THE FIRST time in its his¬ nounced
Saturday
by
Earl
E.
not
others on the basis of ar¬
Of allotting brokerage commis¬
tory the International Food and Crabb, Chairman and President.
bitrary standards. He also wanted
sions to selling dealers.
Home Show will -feature a booth
The Minneapolis investment or¬
to know who was going to make
Mr. Cook, who at an earlier musponsored by a .securities firm. ganization, for many years one of
up the arbitrary standards for extual
fund
conference
surprised JT,.
M.
H.
" cno^;,,0 :nvpc
Bishop
&
Company,
a the nation's largest factors in the
of
low-cost
housing,
leading Minneapolis firm, is pre¬ financing
well

working

are

survey

CHy

tance that the SEC had
..

"double

of administration

standard"

in its

.ge,1't^g.h..or J° soit'

said Wednesday that the Commis-

sion

mutual

believes

reached

funds

mission "must give serious thought

eystone

undertaking

Section

a
was

Custodian Funds

BOND, PREFERRED AND
COMMON STOCK FUNDS

re^err^^ to
Com-

Act of 1940 which states that

pany

SEC

times

"is
it

authorized,

deems

such

any

that

sub¬

stantial further increase in size of

investment companies creates any
,lniv,

...

'0lVthg public interest,
th® pr0trlT
the
df

The

Keystone Company

50 Congress Street. Boston 9, Mass.

Please send

prospectuses describing
Organisation and the shares of your

your

Funds.

ten

Name

,D-<id

if
S, /
mvestlftl0r!
YYwY
? investment
^L security markets," etc.
and oq C,;f»5Stme1t tCrpanles
,

Mr. Cook, duplicating
confusion

;

entities

earlier

another

SEC

Commissioner, Clarence H.
Adams, laid at the doorstep of the

Address

City

State

mutual fund sponsors the respon-

sibility "to
gaged

see

sell

thoroughly

that the
their

qualified

men

shares
to

conference
more

cnnnciHiii+xr

isibility

himself

remarked

in-

Mr.

Cook's
dealers

speech> the seven hundred dealers

learned

that

mutual

funds managers are expecting a
«stable

future

rfsing

market»

Thev also heard

for

the

address

^ture. They also heard an address
by Clyde F. Gay, Vice-President
John

Insurance

Hancock

Mutual

Company,

companies

surance

it
re-

from

run

say

and

Life

that in-

mutual

funds can "supplement and eom-

rium

marked that insurance and mutual,
£unds
le should know their
respective limitations and bounVaries
The

and

Fund

Audito¬

search & Management, Inc., investment advisors specializing in
Canada and Canadian industries,
was announced Friday by Harold
Lon&> President. The new com-

seeks

through the

tablish

reflect

curately
needs

public
in

desires

and

was

employing

retirement

the

ties for investments,
&

ment homes in suitable communi¬

M. H. Bishop

Company is planning a display

which will feature National Stock

Series,

fund.

hibit

will

of the

feature

A
be

award

shares of National
a

invest¬

leadipg, mutual

ment

ex¬

ten

Stock Series

lucky ticket holder. 3phe drawing

will take

place the final night of

show.

Wicllman^William Gie-

Edward

Daniel

and

sen

firm

{a.

•

members
,

Needham

are

f pjanhihg the

the

ex¬

NEW PLAN for', systematic

cumulation

announced

ac¬

by srrCall investors of

Karl

was

Pettit,

ties."
"There
data

available

now

afford

can

during

their

Under

$200
of

and

$50

the

plan

initial

subsequent
more,

investor

investment

with

minimum

manage

years,"

Crabb

declared.
A

Y
toward

start

data

must

A Mutual

Prospectus

may

now,

and

women

The I.

over

65.

The
200

Parker

ujmii

tional

magazine

advertising,
objectives:

The first is to encourage

equipped

mature

;

couples

the threshold of retirement to

request

Corporation

1925

Loud, Arisi:tt & Co.
New York

—

Chicago

—

Atlanta

—•

Los AngcleH

Prospectus

request

has

finan¬

Berkeley St., Boston, Mass.
•FOUNDED

con¬

ducted thorugh the medium of na¬

.
pany has offices at 39 S. LaSalle
street, in Chicago, and is designed
the to provide complete information

l'ir)\peclus

em¬

.!-

S. survey, being

Business Shares

be obtained

from investment dealers

assembling this

made

phasized, if both finance and the
building industry are to render
practical
and
effective housing
service to the coming and rapidly
expanding market of retired men

investments cially
a

where peo¬

and

own

later

two fundamental

makes

ple facing retirement want to live
and what kind of housing they

of the Fund.

President

little

comparatively

American
Investment Fund

ac¬

wants,

was one for ;the dealer

who

"es¬

survey

blueprint which will

housing,"

shares of Knickerbocker Fund

Mutual Funrl Nnt*c

the

attendance of 60,000

Conference

Investment Dealers' Digest.

Municipal

expected.

hibit.
Mutual

held under the auspices of the

Crabb explained, "with
objective of developing and
Realizing that the public is not
mass-producing low-cost
retire¬
often informed about opportuni¬
is

piement each other." Mr. Gay re- -the

was

Sept.

Minneapolis

from

senting the exhibit. The show will

THE FORMATION of Canada Re-

that

hundred

aside

Totally
,

standards

sales

are

perform

likely that this

same

the

Mutual I\Und INOtes

they are supposed to
perform." Some of those attending
seemed

en-

the services

the

not the

14 Conference

section of the Investment

the

apply

dividual securities.

have

point where the Com-

whether

would

Dealers' inquiries

invited

Volume 176

Number 5152

The Commercial and Financial

Chronx^.e

(1043)
form and indicate their retirement

nual sales will exceed the

housing plans in advance of the
time when they quit
working.

lion

The
such

second

help make
by attempt¬

plans workable

ing to develop, finance and build
retirement

will

conform

preferences

with

and

the

indicated

pocketbooks

qualified

Mr.

Wilkins

attributed

medium of investment.

planned

retirement

wellcom¬

could

be provided
The

form of

been more institutional

buying of

Wellington Fund, but it has been
accompanied by the largest num¬

out

Group Securities, reported

planners
their

are

housing plans in

set

detail.

state

where

value

$8.67

as¬

per

somehow see to it that mutual
fund managements always
possess
these necessary qualifications.

Turning

Literature

now to sales

ASSETS

the

Axe-

They

dicate

also asked to in¬

are

what

size

plot of ground
preferred retire¬

they

feel

ment

home should
occupy.

their

Through

answers

many other related

hopes

these

and

questions, I. D.

ment

living and housing most
tiring couples will want and
buy.

ping

most

discussions and

re¬
can

now

going forward in the in¬
better retirement
living

our

aging population," Crabb
pointed out, "housing, the most
important factor of all, is being
left largely to chance.
.

"For example, many assume that

elderly couples want

for

own

their later years the same

type of

housing

they have
owned
and
lived in during their
younger and
middle
years.
But
preliminary
studies indicate that older
couples
find it not only

financially

im¬
practical, but also burdensome to
live

and

houses

operate

the

larger
have

which

they
may
needed
during their families'
growing-up years.
„

"There

broad variety
of views among older families as
may

to what their particular retirement

housing
but it

needs

seems

section

objectives

that

these

obtained in
nance

real

views

are,

cross-

should

fi¬

incorporated

United States to invest
the

securities

mu¬

the

exclusively

companies

operating in the natural

resources

literature

is to

found

the

annual average of somewhat in

and

industry may determine
exactly what the retirement
housing market is, and get started
on the job of
serving that market
and in the future."

Valenta, President.

lington

Fund

running
W i 1 k i

at
n

sales ' of

rec9rd

have

Assets

Fund

Resources

"Should

this

the

rath

since

the

general public offering

formal

June 4

had

increased to $1,200,000 from
$107,238. The Fund is qualified for
sale in

approximately 20 states.

PERSONAL
JULIAN
been

tors, it

Board

Fundamental

vestment

the

announced

was

Roosevelt

PROGRESS

ROOSEVELT

elected

Directors

firm

year," he added, "Wellington's

an¬

con-

Policy,

this the Statement of

much effect

used,

seem

one

have had

way or the other

year over the
has been about the

Dick

always being
proposed and used, the problems
with

are

continuing

ones

and

must be prepared to deal with
them for the indefinite future.

Inves¬

the

literature

in¬

ment

companies

and

their

The survey was made

sors.

the

Commission

and

Management
Com¬
research managers of Fun¬

pany,

damental

Investors, and is also

director of Investors
Fund.

Management

Title

industry
gusted

Building,

Philadelphia, Pa.

Policy

annual

Exchange

New

York

members'

golf

members

followed

was

and

Robertblower
with

Hornblojwer,

81.

know

dis-

realistic

are

that

the

State-

not welcomed

was

unreservedly by the entire industry. Indeed it was rather sharply

limitation

unnecessary

was held on
Tuesday,
16, 1952, at Siwanoy Coun¬
try Club, Bronxville, New York.

200

bad

attacked by some. A few financial
writers even described it as an
vate

twelfth

the situation.
we

guests

dinner

Jr.,

Horn-

Weeks, was runner-up
Benjamin R. Nichols

elevating it to
accuracy

and

higher

literature into line with the Stateof

igby

shares and the dividend in
reality
a
return
of
the
investor's

Statement

of Policy now places
exacting requirements upon

very

ffment? r6latin^investments
t0 »PaVnd
future returns
on

with

Policy.
This has been
by the frequency with

which material is submitted in ad-

low net with

the

NASD

Commission

until

after

the

has

been i

days after it is used,
-

Frpmientlv

company
securities.
Those requirements have resulted
in much

reliable

statements

to the rate of return

ment in

invest-

such securities.

But all of the bad practices have
been wholly eliminated.
We

has

had

damaeine

ComSon

fore the
d

;

that

salesmen

some

still

the

inducement

investor will
uation

the

and

the

further

aggravated by
delays between the

excessive

three

davs

both the Com
NASD

are

rnnntrJiLi? thl
uJ

tiJ>rJ,Pnor J° i.ts use. Withdrawal

.}, r^.,eTJa, a:^
as ~.een
Wldely distributed obviously does
P
UP
damage that has
b|en done. However, as a matter
.

Pfa<;tice, and po the credit of

paying for these
This sit-

hp-

ijtPratlirp nppd

within

Tlms

use

2°Hn

distributions in advance.

fn d

after its

prospects of capital
distributions in the future

effect

the NASD

opportunity to reauire

«Section01

not

know

whprp thp lifpraturp

contains misieading statements, it

investment

7le industry, much ot tne sales
ir fP^ure Pse<xuS submitted to tne

NASD or to the Commission,

declaration, the fixing of record

bo7> prior to its distribution. This

dates,

makes it possible for us to make
su§Sesti°ns or comments before

and

the

of divi-

payment

dends, which prolong the period
during
which
salesmen
are
tempted
sales

this

use

argument.
to

reason

these

believe

dates

misleading

fact

that
fixed

are

there

with

this

sole purpose in mind.

Most
least in

are

investments

accumulate
For

use.

by their desire
fund

some

for

future

provide

financial security in old age; for
others, it is to provide the neces-

funds

sary

their

for

the

education

children;

and still others
provide for some deferred

seek to

pleasure, such

long-dreamed-of

travel.

the

investment

trust

industry

quick to realize the effectiveof

appealing to this desire,
For example, supplemental sales

the

defects

which

ulgated,

it is

doubtful

code of disclosure

bent

upon

there

son

that the

can

evasion.
are

use

any
com-

For this
who

some

rea-

believe

of supplemental salee

should

the

be
prohibited
altogether and that the prospectus

ment.

sole

not

selling docu-

yet prepared to

such

extreme

ress

contained enticing
security in one's old
age (sometimes illustrated by an
elderly couple walking hand-in-

that
ever

should

Policy

era

be-

pletely curb the activities of those

measure.

have

come apparent since it was prom-

literature in the pre-Statement of
promises

which

progress

contains> misleading
material,
While a revision of the Statement
9^ ^obcy might go far in correct-

literature

The

ness

sPite

bas been made in the policing of
investment companies' sales lit—
erature, it still all too frequently

motivated, at
substantial part, in making
persons

material is put in final form,

and distributed to the public.

sometimes

96—30—66, with vance in order that there may be hand toward the sunset with conVanderpool Adriance, Adriance & no doubt as to whether it meets tented and carefree
smiles upon
Finn, second
with
a
score
of the requirements of the Statement their
faces). Of course the possi82—10—72.
'
'
; when it is released to the public, bility of lower
security prices was
won

icy arises from the fact that sales
literature is frequently not filed

was

Generally speaking, I am satisfied that the industry has made a
sincere effort to bring its sales
ment

and

securi- widely distributed to the
public,
"profits".- Section 24(b) of the. Investment
bought and paid for by the Company Act only requires that
investor when he purchased his sales
literature be filed within ten

effective-

ness.

indicated

only

load

the
Pol-

were

apparent that it had the real

sales

as a part of the
return
distributions of profits arising

their

effect, not of stifling the use of
legitimate sales literature, but
level

the

treating

was

industry. The attacks upon it
gradually petered out when it be-

rather of

course-

from the sale of portfolio
ties even though these

pri-

the

was prepared with a

,we
worked with the
statement o± Policy, it has becor9® apparent that its provisions
could 90w be improved so as to
make ^ a more effective documen^* ^ *s our intention to undertake such a revision in due

ago.
One now
in sales literature ex-.

arrived

was

noring

upon

in the main accepted in
good faith
and with good grace by most of

came

turn

However, it

initiative.

has revealed certain defects in its

buy shares,
Securities,.without disclosing the fact that the

was

a™?:!?.

Formerly, such representations / One of the difficulties in
were frequently made.
Such a re- operation of the Statement of

gains

Na-

subject

view to correcting certain specific
evils which our previous
experience had revealed to be prevalent.

press
or
implied promises of a
consistent return of 7% or 8% on
one's investments in mutual funds.

jointly

the

c? f

Prov*sions- ^

there

years

sees

not

areas

"v? migJ

presently used is free
flagrant misstatements

several

point

thoroughly

were

over

enough

Golf Tournament

About

literature

ment of

PROSPECTUSES

N.Y. Curb Holds
The

the

Nevertheless,

SOVEREIGN INVESTORS' latest
prospectus
is dated August, 1952, and is available from
Land

fact

those

y*all0n 01ine statement 01 Policy

seldom

spon-

that many of the companies in the

;

NEW

345

which

obviously

was

know, the Statement of
Policy resulted from a survey of
has a vast
quantity of sales literature
of
voluntarily submitted by invest-

today. Mr.

partner

SET
sales

acted

that the in-

,°h£ sales mfa"f Fapita1' obliged to
°.n..tha receipt of which
the amount of he
pay taxes. The

since

As you

Investors

said which

the

from

to
re-

Merle- tional
Association
of
Vice-President of the > Dealers. It revealed
a great vari-^
Investment
Asociation
of
New ety
of
exaggerations,
misstateYork. He is the son of
George E. ments and even some falsehoods
Roosevelt, Chairman of the Board in the sales literature then in use.
Smith and

been

continue

balance

Statement

Tuesday.
Mr; Wilkins said that in the
evening.
Wellington's sales thus far this
Harold J. Brown, Brown, Kieryear-show an increase of about
nan
& Co., won the President's
11% over the like period last year.
Trophy with a low gross of 76,
throughout

Aside

the

years

Natural

level, A. J. participated in the day's activities

Vice-President,

by the

largest investments, oil and
material filed each
natural gas companies, are 24.84%.
past five

Sept.

Wel¬

The

Curb

REPORTS

DOLLAR

This appears

occasioned

vision of material to make it
form

ture

tournament

OPEN-END

been

Frank

GROSS

2,600 pieces.

"P°n

now

der

have

Commis-

to the jurisdiction of the NASD

subject to abnor-

risks

The

has

cooperated closely with
the Committee and has, of
course,

By and large, however, the sales

—

of supplemental sales litfiled with us. During the
Commission's past five fiscal
years
an

sion

Sales Literature Improved

of the

Policy

Policy does not

many

Canada, is 85% invested,
accordingjo an announcement by

fields of

that private

order

fund

Canada

plan-

terests of
for

Fund, the first open-end

gather an accurate
consensus of opinion and a clearcut picture of the kinds of
retire¬

"In

market

mean

vestment is not

indication of the size of the
_

Houghton

tual

investment

since

be taken to

task involved in the administration of the Commissin's Statement

Funds,
managed
by excess of 2,000
to indicate E. W.
pieces of such litAxe & Co., Inc., on Sept. 1
their preference between a
erature has been filed.
For the
sepa¬
amounted
to $60,179,621—a
gain fiscal year ended on June
rate house, double house
or
an
30, this
of $13,134,768 or 27.9% over the
apartment, to state whether they
year, 2,100 pieces were filed.
Sept. 1, 1951 total of $47,044,853.
want a one-floor
The largest amount filed in
home, more than
any
one
floor, one, two or more bed¬ NATURAL RESOURCES of Cana¬ one year, fiscal 1951, was just unrooms.

the

misleading

are

erature

TOTAL

that

literature,

volume

earlier.

can

mal

Sales

three

months

gsss^sf
.of self-regulation.

phrase

subject to normal market risks."
complex and hazardous undertak— Of course, this does not
adequately
ing involving the safety of other point out or explain the risk inpeoples'money. The industry must volved. Further it is felt that it

Aug. 31, 1952, compared with $8.39

living

some

They are asked to
they'll want to live,

Fund

4**141

some

Stock

Group Securities, reported

the

asked

retirement

Common

1b1

as¬

months earlier.

The

survey

•

value of $7.90 per share on
Aug. 31,1952, compared with $7.88
three

questionnaire, in which

individually.

D.
a

retirement
and

home

■

edge, experience and integrity required of a trustee engaged in a

set

developments than

munity

spell

building

and through the labors of its Sec¬
retary, Ray Moulden, has assumed
great responsibility for the en-

Mutual Funds and the SEC

"This

year," he said, "not only has there

retired .persons.
If the/ ber
of
small
purchases in the
demand exists then it
may be that Fund's
history."
private enterprise could give bet¬
ter values at lower
prices through FULLY ADMINISTERED Fund of

assembly
line
mass
methods, made possible

Continued from page 3

the

larger sales generally to broader
public acceptance of mutual funds
as

living houses in spe¬
cially developed communities that

$50 mil¬

mark."/

In the light of the prog-

already made, it
entirely possible, in

through

the

Commission,

joint
the

seems

due

course,

efforts

the

and the
individual members of the indus-

NASD

try

itself, to keep the content of
supplemental sales literature with-

Harold J. Brown
of

the

United SCIENCE Fund
United INCOME Fund
il

Golf

Townsend

United ACCUMULATIVE

Chairman

assisted
Leonard

Allen,
C. Greene, Henry C.
Hagen, Mar¬
cus Kaufman, Edward A.
O'Brien,
Milton

Reiner, and Lincoln O.

Robertshaw

was

Committee,

from

Through Periodic Investment Plans

the

Exchange

achieved

nowhere
Under

ments

There

and

Prospectus from your
or

WADDELL & REED, INC.
Principal Underwriters
1012 Baltimore Ave.

HemphilENoyes Co.
Announces New Name
Hemphill, Noves, Graham, Par¬
& Co., members of the New-

Kansas City, Mo.

consider-

persons

who

in-

are

even

its

that

Stock

Exchange,

and

example, the Statement of
Policy requires that under certain
circumstances the market risks
volved

in the investment shall

in-

explained.

made to

Policy
are

results

investment

companies must be staked with

and

objectiveness
in
keeping with the investment haz-

ards involved.

meet

inserting

Efforts
this
a

re-

brief

Much of the credit for the
of

under

success

the

reasonable

already

Statement

firmly with

very

lations

that

march

used

Committee, under the direction
its

Chairman,

Harry

Prankard.

the

with
a

increasing fre¬
standardized

certain

chart

permitted

the

net

accumulated

asset

one

value

over a

years,

within

Policy.

chartTs"you^'know,
sh0ws

which

being

Statement

ten

That

will

One tyoe of sales literature be-

given investment

NASD.

future viotemptation to

competitors

Committee

the

any

the

Policy
goes to the Investment Companies
of

greatly minimized,

"performance"

achieved

both mislead investors and to steal

have

Further,

desires

that it intends to deal

understood

quency

meas-

bounds.

Commission

ing

Praises NASD Investment
Companies Committee

Ure

the
of

appeals
permissible.
The

achievements

accuracy

circumventions.

pointed out

to.

Statement

emotional

longer

Sfept. 15 it will be have been
Hemphill, Noyes & Co.* quiremfent

effective

known

announce

such

alluded
the

sons

York

City

culated
As

objectives,
a

provisions
few, I regret
who have indulged in cal-

and there

its

today

advertently violate

number

to say,

New York

still

are

able

Exchange staff.

not

and still is largely a process of
education, both as to its require-

dino of the

Fund

40 Wall St.

membership and Farncis X. Gau-

■v.-

Investment Dealer

have

The administration of
the Statement of Policy has been

course,

perfection.

This

which
of,, a

neriod of

together with

capital

Continued

gains
on

distri-

page

The Commercial and

-36

Financial Chronicle

Thursday, September 18,1952

...

(1044)
♦

Thus

of custom.

matter

IContinued from page

their

view

investWe doubt that it
Previously charts to permit such a

tuitions and dividends from

basic revisions
upon.
It was only

certain

agreed

were

then that the Commission decided

the time

that for

<t would raise

being, at least,
objection to the

standardized chart
standardized cnart.

-usp of the
wise of tho

limited

fae

should

ihey

were

iion

prior to the formulathe standardized
chart,

they

are

still not wholly satisfac-

such

example,

charts

lory.

For

«lo not

clearly show the sales load,
the entire

which

about

matter

unduly self-conFurther problems regard-

industry
ficious.

seems

presentation of capital
still exist. It
is to be hoped that we can soon
iointly work out some reasonable
-Solutions to these problems.
*
the

ing

42ains distributions

Another

Literature

Institutional

problem the Commis"institutional"

Institutional

lure.

use

litera-

literature

that which does not advertise the
securities

guch

cation

and

not

point where the Commission must
give serious thought to undertak¬

Commission

en¬

now

profits over losses. Further, it
be

the

answer

the

ing

alloting brokerage commissions to
dealers in investment company se¬
curities. It is intended to be sent
open-end investment com¬

all

panies and their underwriters as
well as dealers. After the survey

has

been

the Commission
position to determine

made,

will be in

action should be taken.

what

the
cry that the sources of venture
capital are drying up and that new
undertakings are finding it in¬
creasingly hard to obtain the nec¬
essary
capital to explore new
Today we hear on all sides

security. Further, any
person advertising the publication
should be required to furnish a
copy 0f it to every person who requests it and should be prohibited
fr0m offering the securities of any
investment company to any such
person until that person has received the publication and had an
opportunity to examine it.
It is our hope that such a rule
company or

where their size

have been
made in this area by those who
have been wise enough to invest
in

whose " securities

companies

undervalued because of spe¬

were

cial but essentially temporary

cir¬

circumstances

These

cumstances.

fields.
For the most part organ¬ might be a lack of adequate work¬
ized investing has overlooked the ing capital and a resulting inabil¬
fact that the blue chips of today ity to obtain new funds. Or, para¬
doxically, they might be an excess
were the promotions of yesterday.
Most new enterprises have been of current assets not yet profitably

will entirely replace the interpre- largely dependent upon such funds employed or a niggardly dividend
contained in the Cashion as they were able to obtain from policy in relation to earnings both
letter and that all future institu¬ venturesome individuals. Institu¬ present and anticipated.
The primary reason for mutual
tional advertising with respect to tional investors do not, as a rule,
investment companies would be place their funds in such under¬ funds is expert
management.
Hence it is said that they should
takings
governed by its provisions,
Prior to
the adoption of the be in a peculiarly favorable posi¬
if Such a rule is worked out it
Statement of Policy many mutual tion to locate and
exploit such
might also serve as a useful medium
for
educating the public funds claimed in their literature situations. It is argued that a

particular coml>any but which seeks to interest
Ihe public in a particular class of about investment companies. This
securities, such as mutual funds is a well worthwhile objective,
generally, or in a particular type Of course, as you know, if such a
any

service, such as the advisory
services rendered by a broker or

■dealer.

rule seems feasible it will be df1
culated for public comment and
the
Commission
will
carefully

that

they

not
was

important

were

capital. This was
true in the sense in which it
intended to be understood, al¬
of

source

though

new

few such funds did pro¬

capital

venture

vide

for

new

companies

investment

group

could, either as a syndicate or
through a new company, acquire
enough of the securities of indi¬
special situations so as to
enable them to be

real force in

enterprises. Hence, the

Back in

letter, since referred to

the

fidvertising by

dealer in invest-

securities would
mot constitute an offering of se-curities of any investment comfiany, if the dealer was prepared
company

lo offer more than one security
find, before determining which se-

■curity to offer, considered the individual needs of the prospective
investor.

ni fhi
the

done

*>een

that

Since

time

basis

most

that

opinions
*The so-called Cashion letter has

twoved
laasis

for

the

and

are

reason

had

companies

investment

that

simple

the

for

vertising

dealers, who sell the

Usually portfolio transactions, as
matter of convenience and effi-

limited

number

Act

dealer

from

make a real and very

commissions

Act if he has

the necessity of

purity

fitate

sale

for

mind.

than

one

the

and
Such

se-

proper

folio

selling dealers is
churning the port-

for the purposes of produc-

construe-

ing enough commissions to satisfy
the
dealers.
Such
churning , is
difficult to administer since more apt to occur where dealers
compliance with it rests upon the have been promised in advance
dealer's
unexpressed
intention, that they will receive a portion of
lion

the

statute

obviously

•rery

For

example, if he determines in

the commissions. But it should be
prospective in- remembered that where there has

advance

vestors

particular security, then

offer

tie does not

come within the principles enunciated in the letter. If,
tiowever, he fully intends to con-

inder the investor's needs he may
use such
advertising material.
For

some

time

mission has

been

the

now

Com-

considering the
possibility of formulating a more
practical

basis

for

institutional

been an express advance promise,
the commissions really constitute
additional remuneration for selling the company's securities and,
therefore, should be fully disclosed
In

other

cases, there is no ad¬
promise to dealers that they
will share in the commissions on
portfolio securities. But where a

them

would

panies

whose

due

securities

larger

of other types
■

the

scale

in those

support

the mutual funds might well pro¬
duce

profits

surate with

than commen¬

the risks assumed. It

lion

regard themselves as being entitled to a portion of the commissions

which

fore,

without

the

use

pros-

meet

certain

standards

prehensivesness

com-

prac-

such

commissions the dealers may well

matter of

right. Therequestionable whether

and

objectivity, there is more than a difference of
.Such a rule might also permit, degree in
those cases where a
subject to apprqpeiate conditions, share of the commissions is promadvertising that Such publications ised in advance and those where
4Hre

available.

such

commissions

are

distributed

tial

the

com¬

scale

would

on any

result

Substan¬

dis¬

astrous

price decline or in the
necessity for suspending the re¬
demption privilege.
Mutual funds shares
the

public

sold to

are

medium through

investor

which

the

both

diversification of risk and

professional
It

funds.

whether
reaches

management

important

mutual

his

know

fund, after it
size, can con¬

certain

obtain

can

tinue to exercise real management
of its investments

whether the

securities in

amounts

deals

of necessity so

which

large that
that degree of flexibility essential
are

the

achievement

investment

results

the

best

longer

possible.
It is

important to know whether

excessive

size

renders

sible to shift from
another

when

one

it impos¬
security to

conditions

indicate

that it would be desirable to do

so;

Would the effort to liquidate

large
given security break

of Mutual Funds

funds

have

grown

portfolio rise and fall with:
as a ship rises and falls

an ocean

ra¬

in number and in size. At the be¬

These

swell?

;

questions which cart
only be answered, if at all- aftef
a
thorough ; study of the many
problems involved.: Serious con¬
sideration is now being given to
the: undertaking of such a study.
are

was

pointed out that

matter

technique

number of mutual funds

might invest
their assets.
seems

limited portion of
an undertaking

Such

to merit careful considera¬

tion. It may well be in view of the
enormous

ber; of

133

and

than

$300,000,000.

One

for

been

it.

growth
it

Sunflower State Oil

carefully following this
process

and intends to give

Offering Completed

increasing attention.
In this connection Section 14(b)

such
investments
could be made through a corpora¬
tion organized for that purpose in

pectus of articles, brochures, pamphlets or other publications which

Growth

Mutual

of investors.

financial

Limited

portfolios

well

tice

the

tempt to liquidate

of the

$400,000,000. The Commission has

then be suitable for inclusion on a

company

alloting

Nor should the investor be
sold on the promise of the liquid-;
ity of his investment, if an^ at¬
pany.

these has total assets in excess of

Specifically, we have
thinking in terms of a rule
which might permit the distribu-

followed

size

the

because

the market

com¬

fidvertising.

has

have

would

seasoned

become

t>een

voluntarily

which

our

doubt

course

vance

per¬

not

These, ; then, are some of thd
companies had -increased problems that we at the SEC are
their total assets had
pondering today.; They are not
increased
to. approximately
3.6 problems of easy solution. At the
billion dollars. Of course, some of least they will require a great
this growth has been due to the deal of careful study; and even
upward trent in the market during then easy solutions will not be
that period, but much of it is also found.
But the more closely the
with large amounts of securities of
due to the increasing popularity industry cooperates with the Com¬
immature
enterprises with only
of mutual funds.
mission, the more likely it will be
remote hope of success. What is
While the great majority of mu¬ that a solution satisfactory to all
meant, I take it, is this: there
concerned will be found.
I can
are
today, as there have always tual funds have less than $50,000,assure you that you will have our
been, worthwhile business ven¬ 000 each in total assets, there are
cooperation and I believe that it
tures in the early stages of de¬ ten companies having total assets
is desirable for you to give us
velopment which need and merit between $50,000,000 and $100,000,yours.
If we work together, this
the reasonable support of those in 000; four companies have total as¬
industry, in the basic soundness of
control of large pools of capital, sets between $100,000,000 and
which all of us believe, will come
such as mutual funds. If such sup¬ $200,000,000;
and there are two
to realize the high hopes we have
assets of
port were forthcoming many of companies with total

mutual funds

in the prospectus.

views

economy;

the

fidvertising does not violate that

ginning of 1942 there were 73companies in the4 field, having
that here is an oppor-;
total assets of about $412,000,000.
tunity to show not just by words,
At the end of June 1952 th6 nurh^
contribution

constructive

brokers,

1933, whereas
another
One of the obvious dangers in
using precisely the same the practice of alloting brokerage

the

sought privately.

which mutual' pidly over the past ten years, both

field

funds might

effected through one

are

here

been

♦—„—

„

real

some

company's securities, a portion of generally not been furnishing such
Ill
the brokerage commissions on the capitals
'
;'
company's portfolio transactions/,
It has been suggested to me that

However, since the dealers who
standpoint self the company's securities have
but: by deeds,
a
faith in the
df the* industry as well as from indirectly produced the business
strength and dynamic character
that of the Commission. We be- which necessitates the effecting of
of our great democratic capitalis¬
•teve it is unrealistic in its ap- at least some portfolio transactic system. This would not mean,
(proach in that-a certain type of tions,
many
dealers - and some
of course, that mutual funds would
advertising by a dealer who has issuers feel that they are entitled
proceed to load their portfolios
only one .security for
sale
is to a portion of the commissions on
recklessly
and
indiscriminately
deemed to violate the Securities such transactions.
,
both

make

goes, could
contribution to our

should

the promise of professional

•regulation of institutional adver-

Using,

tivity, the argument

economy as well as proving pro¬ holdings of a
capital to industry or that a par¬ fitable for the mutual funds them¬
the market and hence either make
ticular
investment
company
is selves. This
suggestion also merits it impossible to liquidate the hold¬
such a source unless the extent
careful consideration.
ings or if liquidation is forced
to
which such investments
are
I
have
commented
on
these through, then only at a substantial
made
is disclosed. It is hardly
It is possible that after a
matters- of
managerial
concern loss?
necessary
to add that this pro¬
certain size is reached the most
vision of the Statement of Policy only because I believe that all of
that can be done is to hold; on to
you are entitled to hear publicly
virtually put an end to such ad^
the securities and watch the value

t^ir undJr^riters
their underwrit

2 EU ?

of alloting to

unsatisfactory ciency,

authorization

eral

another problem with
which the Commission has been
c2'1.c2rr?f<* for ,sonJe.
eLi ?
which it has not yet beem able to
exPl°r^, J.s
Pracbce of recipfocal bu?i^ss'« °r as xt *
*imes called, give-ups.
Rec pcompanies

companies in gen¬
direct sources of new

that investment

-J®1roker^e Commissions

"Cashion letter," that institutional
wnent

Commissions

Rrnkera^

will

management, if such management,
as a practical matter, is impossible

vidual

Statement the elimination of the factors
1948, the staff of the analyze and weigh all comments
of Policy now provides that it is
Commission expressed the opinion and suggestions received.
causing undervaluation. Such ac¬
misleading to represent or imply
in a
,

the

representation

functions

Investors

formed.
sold

and

those

that

profits

Large

seriously hampers
of their true

performance

assumption

there is yet

tions.

point

advertise and sell securities

suggested that

another field in which
mutual funds might well operate
to
maintain and strengthen our
industrial economy.
This is the
field of
so-called special situa¬

any

the

function, it might well be mis¬
leading for them to continue to

usless functions.

It has been also

reached

have

the

Section 14 study.

them

mutual

that

reached

funds have

mutual

that

believes

Commission

The

funds are
is to furnish more accurate infor¬ parasites in the investment field,
mation than it now has as to the standing
between
investor and
nature and scope of the practice of issuer and performir^ relatively

the publiparticular

any

the

while limiting the exposure
fund, and would hold
real hope of a substantial excess
my,

preparation of a would
questionnaire the purpose of which charge

and

tend

would

interest only in

of any one

The

de_

publication

arouse

report

vestigations and its recommenda¬
tions to the Congress."

which

important to the econo¬

tation

tion has wrestled with is the
of so-called

scale

time to

studies and in-:

of its

results

the

interested,

are

would be

gaged

on*y present a fair and objective
description of the nature and
method of operation of investment
companies generally, or of: onei oir
°* ceJ1?-J fS+w fnv aH'
Further, we b®^ve tha hli^ti ~
vertising of such a publication

Although the charts now in use scription of the
fire much less objectionable than
its
contents
as

time

from

commissions, charges of breach of
trust or fraud might well be made.

would be wise
publication to

such information had identify by name or context any
in highly misleading particular investment company or
forms but as a result of the joint security. In our opinion, it should
industry

undertaken

that

where
a
portfolio
is
churned to provide for brokerage

used

«tudy by the Commission and the

prospectus.

the

made

not

the investment field,

and

such activities may now be safely

Further,

■containing
*>een

if adequate disclosure

Mutual Funds and the SEC
income.

role in

the statute

anent

there is a violation of

companies

ment

greater

consequent

case

either

growth enjoyed by

mu¬

tual funds in recent years, and

the

Investment

Company

Act

The

recent

offering

300,000

shares of Sunflower State Oil Co.,

stock (par 10 cents)
speculation" at $1 per share,
was made by Israel & Co.,
at such times as it deems that any
members of the NASD, has been
substantial further increase in size
of investment companies creates completed, all of said shares hav¬
ing been sold.
any problem involving the protec¬
The net proceeds will be used
tion of investors or the public in¬
for Sunflower's drilling program.
terest, to make a study and in¬
vestigation of the effects of size
Hayden Stone Adds
on
the investment policy of in¬
of

1940

provides

"The Commission

follows:

is authorized,

Inc.

"as

common

which

vestment

companies and on
on concentration

security markets,

(Special
.

of control of wealth and industry,

and

Stone &

companies in which invest¬

to The Financial Chronicle)

SPRINGFIELD, Mass.
Peek

now

with

Albert
Hayden,

—

Co.,-1387 Main Street.

Number 5152

yolume 176

The Commercial and Financial Chronicle

(1045)

Continued from page 5

since 1948; they were down
164 and

'The State of Trade and

Industry

$3,152,000,000.
This was the largest monthly dollar volume on record, ac¬
cording to the United States Departments of Commerce and Labor,
but physical volume was about the same as in August, 1951.
The
higher dollar figure resulted from increased costs for labor and
materials.
Building outlays for the first eight months of the year
were
slightly above $21 billion, a 5% gain over a year ago.
.Spending for public construction was 20% above the like 1951
period.

The

week

before.

index

foods

through the national election

paper,

week, and, states this trade

help but take

reports persist that President

The
unfold

ing in
by an

degree, and civilian attitudes should be

industry, it adds, is

in terms of current

eight

weeks

will

cause

will

determine

another

break

whether

too,

steel

coal

is reluctance to buy.

below
of the

some

government

steel strike

areas,

ceilings,

firmed

steel scrap grades

some

just

them

they

inactive

are

American

pricewise, the above

Iron

and

ing Sept. 8, the rate

was

Steel

100.8%

output totaled 2,093,000 tons.

2,017,000 tons.

Institute

announced

that

(revised)

was

estimated at

Recovery in Post-Holiday Week

was

330,197,000 kwh., above that of the

pre¬

ceding week when output amounted to 7,324,127,000 kwh.
It was
.'516,672,000 kwh., or 7.2%, above the total output for the week
•ended Sept. 15, 1951, and 1,205,223,000 kwh. in
excess of the out¬
put reported for the corresponding period two years
ago.

Loadings Rise for Week and

Loadings of

Year

week's

above

the

cof 5,405 cars, or

freight for the week ended Sept. 6, 1952,
Labor Day holiday, totaled
746,044 cars, ac¬
Association of American
Railroads,

holiday.

total

represented an increase of 13,275
cars, or
corresponding week a year ago, but a decrease
0.7% below the corresponding week in 1950.

United States Auto Output Sets New

High Record

In Latest Week
"to

Passenger car production in the United States last week soared
its highest point in 1952 to
103,054 cars compared with

fairly firm tone, aided by

dock workers' strike.

Lard

was

an ex¬

prices again worked lower.

purchases declined from both a week ago and a
year ago in the period ended on Wednesday of last week.
Many
stores returned to the practise of Saturday opening although there
was growing demand on the part of the employees for a
five-day
week.
A few localities were testing a Tuesday-to-Saturday week.
Specialty stores continued to fare somewhat better than depart¬

Southwest +2 to +6; South +1 to +5; Northwest unchanged
+4; East —I to +3; New England, Midwest and Pacific Coast
—2 to +2.

Canadian plants turned out
6,533 cars and 2,960 trucks against
cars and only 1,710 trucks last
week, and 4,709 cars and
1,952 trucks in the like week of 1951.

lower than

Food sales

Business Failures Hit Lowest Level
Since 1948
Commercial

and

industrial

ended Sept. 11 from 110 in the

Inc., reports.

failures

fell

the

moderately above

a year ago and

moderately

below the holiday week. Housewives favored purchases of
poultry
and ham, but continued to shun expensive cuts of meat.
Volume
in produce diminished slightly.

Federal

dex

for

1952,
the

Apparel sales continued to be above
diversification

displayed

was

year

ago.
as

A wider
consumers

expensive merchandise

for

the

fell

Volume in housefurnishings remained unchanged from

was

noted

was

Board's

ended

below

in¬

Sept. 6,

the

level

For the four

Sept.

1952,

sales-

increase of 2%.
Jan. 1 to Sept. 6,

the period

For-

1952,

department store sales registered a.
drop of 2% below the like period
of the

preceding

Retail

trade

year.

New

York

lasb

week

was subject to a set-back
the
latter part of the period which
rei-~
suited in a decline in the total

weekly volume of about
11% be¬
the comparable 1951 week.

According

to the Federal Re¬
Board's index, department"

serve

store sales in New York
the weekly period ended

1952,
like

decreased
period

11%
last

City for
Sept. 6,

below

the

year.

preceding week a decline of 4%
(revised) was reported from that
of similar week of

1951, while for
Sept. 6,1952,,

the four weeks ended

decrease

6%
below the level of
the period Jan.

volume

was
a

declined

registered,
For

year ago.

1 to

Sept. 6, 1952,

10%

like period of the

under

preceding

the-

year..

Glenmore Distilleries

Debentures Offered
Glore, Forgan & Co. headed a
nation-wide group of underwrit¬
which on Sept. 12 made
public
offering of $12,000,000 of 4% sink¬
ing fund debentures, due Aug.
ers

1,
1972, of Glenmore Distilleries Co.,
of the
country's leading dis--

one

tillers.

The debentures

priced

are

at 100%

and accrued interest.
Proceeds of the

financing will
retiring all term debt

of the
company and

preferred

$10,750,900 will be
ceeds

and

will

the

its outstand¬
stock.

About

needed for

remaining

used

thi^
pro¬

for additional

working capital.
The company last
year had salear
of

$59,054,873 and sales
767j071 for the first six

$27,-

months^

this year. Its
principal business i»
the production and sale of

various*

types of domestic whiskeys. The'
principal
brand
names
under
which

the

sold

company's

are

whiskeys
Kentucky Tavern

Yellowstone

bonded

whis¬

keys; Glenmore and Yellowstone
straight whiskeys and Old Thomp¬
son
and
Tom
Hardy
blendedl
whiskeys.

W. P.

Mulligan With

Wm. E. Pollock Go.
William P. Mulligan has joined
the sales department of Wm. E.
Pollock & Co., Inc., 20 Pine

Street^

New

York

City, dealers in U. S.

government securities,

state,

mu¬

nicipal,

revenue, railroad, indus-.
trial and public
utility bonds

and,

equipment

trust

certificates.

Nassau-Suffolk F I F
HUNTINGTON, N. Y.—Stephem
T. Monahan has opened offices afc
304 West Main Street to

conduct?

securities
name

Sales

and

week

ended

reflected

firm

week

ago

tightening

noted in back-to-school volume

preference for

Reserve

the

preceding week.

weeks

Unit-wise, volume appeared to be

in preceding week.

first time in several months.

preceding week, Dun & Bradstreet,
This decline brought casualties to the
lowest level

were

further

seasonal lines.

the

the past week in retail

Bradstreet,
Inc., as being 1% below to 3% above a year ago. Regional esti¬
mates varied from the year ago level by the following percentages:

6,020

some

stores.

stores throughout the nation was estimated by Dun &

the week's:

Department store sales on a
country-wide basis, as taken from

and

Ago

increased

holiday-

are

Consumer

The total dollar volume of goods sold

the

schedules

purpose

Latest Week and Year

heightened demand

delivery

ing

Cotton prices were irregular most of the week but moved
sharply higher on Monday of last week, following publication of
the official Sept. 1 crop forecast.
The estimate was for a crop of
13,889,000 bales.
This was considerably lower than the trade had
expected and touched off a buying movement which carried spot
prices well above the 40-cent level.
The indicated outturn at
13,889,000 bales, was 846,000 bales less than the estimate of a
month ago, and compared with a yield of
15,144,000 bales last year,
and a 10-year average of 11,775,000 bales.

ment

was

be used for

the continued weakness in whole¬

of the-

for merchandise
appropriate to the
late fall and the winter

in slow demand

light receipts, hog prices fell to the lowest
was

most

markets in the

Bulwarking much of
volume

low

84,865
cars in the previous week, when the
Labor Day holiday
production, and 100,584 cars in the like week a
year ago, ac¬
cording to "Ward's Automotive Reports."
Total output for the past week was
made up of
103,054 cars
and 25,454 trucks built in the United States
against 84,865 cars and
18,500 trucks (revised) last week and 100,584 cars and
28,905 trucks
in the comparable period a year
ago.
•<.

(revised)

cut

•

The crop continued to make good
prog¬

depressing influence

revenue

to the
representing
increase of .18,700 cars, or 2.6% above the
preceding week when
loadings were reduced by the mine workers' memorial
The

previous, and with 297.91

Trade Volume Suffered Declines Both for the

:an

1.8%

week

year.

the result of

Ago

which included the

cording

the

sale pork quotations.

Car

pound

show

level in four months.

•

The current total

per

bookings confined to scattered smail amounts- for
nearby shipment.
Interest in advertised brands of

Despite relatively

by the electric light
industry for the week ended Sept. 13, 1952, was esti¬
7,654,324,000 kwh., according to the Edison Electric

Institute.

displayed

and both cash and future

97.1%,
101.2%

The amount of electric energy distributed
at

to the threat of

2,023,000 tons.

Electric Output Shows

mated

price

^nd power

the

heavy trade and commission house selling prompt¬
by prospects of a large African cocoa crop.
Warehouse stocks
of cocoa were reported at
121,037 bggs, down from 127,063 a week
ago, and 204,228 bags at this time a year ago.
Coffee was active
and strong. Increased roaster interest in
offerings was attributed

the

of capacity and actual

A month ago output stood at

One year ago the rate

;and production at

function is

advances

.operating rate of steel companies having 93% of the
steelmaking
•capacity for the entire industry will be at an average of
101.8% of
•capacity for the week beginning Sept. 15, 1952, equivalent to
2,115,000 tons of ingots and steel for castings.
In the week start¬

•

the

family flour was a little better as mills protected against price
during the week.
Export flour business showed little
if any improvement.
Cocoa prices went sharply lower last week

before

were

market

with

immediate

.trade paper concludes.
The

total

chief

its

held

level of the week before and
re¬
mained slightly higher than in
the
comparable 1951 week.

Cautiousness in buying persisted in the domestic flour market
the past week.
Both hard and soft wheat bakery flours were

end

and

week

year ago.

production this

"Steel" points out.
%
Scrap, a closely watched barometer in the steel industry, is
..stagnant marketwise. Mill inventories of scrap are high and there

the

weeks

early maturity.
Following recent de¬
clines, rye prices turned upward. An improvement in demand was
sparked by the belief there may be some frost damage in Canada.
Oats prices advanced, influenced
by a decrease in receipts and
smaller imports from Canada.
Trading in grain futures on the
Chicago Board of Trade declined last week.
Daily average sales
of all grain and soybean futures totaled
about 32,500,000 bushels,
against 37,400,000 the previous week, and 26,000,000 a

year,

swinging

seven

with prospects for an

ress

strike

improvement

corn

strong.

nation's wholesale

a narrow range.

The

Volume in upholstered fur¬
case
goods and beddingf

niture,

continued to be

Commodity Price Index Recovers Moderately
After Early Decline

panding export demand.

summer spurt.
More(
evident in floor cov¬

was

promotions.

new crop year have exceeded
expectations, totaling approxi¬
mately 55,000,000 bushels for the period.

otpimistic that it is pro¬
graming big production schedules. September will be its best
v-output month in more than a year.
By election day it should be
pretty clear whether the big production of autos is selling up to
•expectations.
The auto industnr is a master key to steel demand
and production, for it is the biggest consumer of that
metal.
The

fewer casualties
the Pacific and

of the

months to come.
By that time the demands accumulated
during the steelworkers' strike will have been satisfied to some

miners'

many
the 1951

Export clearances of wheat and flour for the first two months

eight weeks, continues this trade weekly, should
strong clue as to size of civilian steel demand for

The auto

cas¬

Wheat prices were buoyed to a large extent
in export business, smaller receipts and a
heavy movement of wheat into storage.

some

needs.

lowest

sum

and

use

interest

Grain markets generally ended on a firm note after
fluctuat¬

strike.

also

general

293.87
the corresponding date last

By the end of this month the steel industry expects to have
cleaned up the military steel orders that accumulated
during the
steelworkers'

the

was

This compared with

military steel.
..

where

trade had

trending downward in the first part of the week, the
•daily wholesale commodity price index, compiled by Dun & Brad¬
street, Inc., recovered moderately to finish at 293.29 on Sept. 9.

unpopular war
off the demand for

of the pressure

some

After

Truman will bend every effort to get the Korean War ended be¬
fore the election so that voters will feel the Democratic
party
is a party of accomplishment., An end of that
couldn't

This

represents the

"Steel," the weekly magazine of metalworking, the current week.
eight weeks will take

industry

trade

wholesale food price

Wholesale

the size of steel demand and supply for some time to
come, says
The

retail

general trend of food prices at the wholesale level.

lot of questions about

sharpest week-to-week drop in almost two years.
It compared
with $6.79 on the like date a
year ago, or a decline of 2.8%,

were

Output Moves Moderately Higher in Current Week
up

centered

index, compiled by Dun & Brad¬
street, Inc., declined sharply last week following last week's level¬
ing off movement.
The index fell to $6.60 on
Sept. 9, from $6.70
the

off from the

Buying activity in

decrease

Atlantic

The

eight weeks will clear

change appeared

same.

week's

declined to

Wholesale Food Price Index Drops to Lowest Point
In Seven-Week Period

issued.

The

Little

year.

States, while the West North Central continued
unchanged. Failures were less numerous than last
year in all re¬
gions except the East South Central which remained
the

company
formations recorded during the first seven
months of 1952 reached a total of 54,996. This was better
by 7.4%
than the 51,189 for the similar 1951 period, although 7.8% fewer

Steel

last

Six of the nine
geographic regions reported
the week.
Small increases occurred in

South

year ago.

corresponding 1950 period when 59,629 charters

129

during

New

than in the

the

television sales continued to
taper

ering.

liabilities of 5,000

sharpest downtrends from
retailing and wholesaling.

figure of 7,819, reports Dun & Bradstreet, Inc. The July number
at 7,549, however, was 17.4% greater than the July, 1951, total of
6,428, and marked the sixth successive month to show an increase
month

as
many busi¬
recorded for the

were

year.

and

ago

1939 when 269

ualties dropped to 37 from 66.
failures as last year, with the
level occurring in

incorporations in the United States during the

the corresponding

week

and 1950 when

Only one-third

small casualties.

All

month of July totaled 7,549, or slightly less than the revised June

over

among

Construction expenditures in August advanced to

business

in prewar

Failures involving
from

considerably from 1951

occurred, respectively.

comparable week of that

stipulated time.
Prior to the suspension, down payments ranging
from 5% to 40% were required.

New

165

failed

nesses

slightly below the preceding week.

year

Appliance and

Co.

business

Mr.

Monahan

merly connected
&

Co.

under

of Nassau-Suffolk

with

was

Ira

ther

FIF*
for-^

Haupfc

The Commercial and Financial Chronicle

(1046)

Continued,

jrom

"True,

page

Thursday, September 18,1952

...

INVESTMENT TRADERS ASSOCIATION OF PHILADELPHIA
The

I have ever met doesn't even

men

personal calling card.
He
uses
no
printed literature whatsoever in his personal conferences
carry a

His entire

with clients.

consists

This

know of

that

all

IhpIp**

good salesmen who
selling aids to great

advantage.
to

imply
i«

some

visual

use

not

does

they

But

it.

when!

knowing

knack

pull

how

know

There

out

of
an

illustrated folder, or a chart, or a
picture. There is also a time to
put it aside and not to overtalk

it.

When

with

salesman

based

pictures,

upon

book full of

pretty story that is

illustrated with charts and

out

goes

definite prepared sales talk

that is

is sometimes

inclined

figures,
to

wear

sales

talk

before,

down,

and

one

parties where

once

fel-

low had cooked the meal. My wife
dragged me in on it. About six
couples were there. The food was
good but the long harrangue that

waited for him to get it over with,
killed all my wife's interest in

his

most

excellent

sauce

pans.

Use

Selling Literature Carefully

Let

finished
with

that

assume

have
interview

you

promissing

prospect. Possibly you have
discussing Mutual Funds, or
special
investment
situation,
a

been
a

There is
tion

time lag for considerathe part of the prospect
a

before your next meeting. This is
a
good time to use an effective

mailing piece.
like

this,

Write

"Dear

short note

Mr.

Prospect:

quite

gards,"

will find
Kindest re¬
need.

you

Make

it short and sweet, and use a
good

mailing

piece.

The

simpler

show

you

that

man

these stocks are appraised so low

deny

book value, he is going to ask you
why th's is so. Then you re in for
en argument that you should
avoid."

tally, those

bank

sale

literature

point

—

use

helpful.
when

Joseph E. Smith

literature"

can

assist

you

Edgar A. Christian

Joseph R. Dorsey

President:

Joseph

Charles L.

Smith, Newburger & Co.; First ViceWallingford, H. M. Byllesby and Company,
E.

Incorporated; Second Vice-President: Joseph R. Dorsey, Merrill
Lynch, Pierce, Fenner & Beane; Treasurer; James G. Mundy,
Stroud

Company, Incorporated; Secretary: Edgar A. Christian,

Janne.y & Co.

Security Traders Association of New York (ST ANY) Bowling
League Standing as of Sept. 11, 1952 are as follows:
TEAM—
1.

mailing piece

POINTS

Donadio., Demaye, Whiting, O'Connor, Rappa
Goodman, Smith, Valentine, Meyer, Farrell

9
6

Meyer, Kaiser, Swenson, Frankel, Wechsler
Mewing, Bradley, Weseman, Hunt, Gronick
Krisam, Ghegan, Jacobs, Gannon, Cohen

6
5

Murphy, Manson, R. Montanye, O'Hara, Pollack.

10.

Lytle, Growney, Craig, Fredericks, Bies
Serlen, Gresten, Krumholz, Rogers, Gold
Bean, Frankel, Casper, Nieman, Bass
Leone, Greenberg, Tisch, Werkmeister, Lopato

4
4
4

11.

Hunter, Klein, Weissman, Sullivan, H. Murphy

12.

Burian, G. Montanye, Voccoli, Siegel, Reid_______

lllllluiai W3I6l diOCK

„.ien &
business
f/nce ^19) are offering publicly
a speculation an issue of 299,-

three days for

9dSPio^ir^g T?Siorganized
1952 in Delaware to

24,

a^ °f the assets of Mount Clemens
Water Products Corp. of Mount
Clemens, Mich., and Mount Clemens Products Co, of New York,

securities
of

intent

Moran & Go. Offers

further

described
to

finds

tend

Newark,

mailings.

1—ill!:--

selling

arp

be
be

another
another

course,

nromntinnc

Tv T
story.
I

™

about investments.

Don't

Build

you

sell

that

the

notice

with

sale

him

onl

Electriglas Corn

? iK
talking

marUy

selling

;

™a"iy

such

fraud

pur-

The model law of the qualifica-

J.,

tion

UDOn

is engaged r»ri

manuiacturing

and

type,
the

Securities

generally

patterned

old

Uniform

Act

Sale

provides

nnalificaqualifica
tion, there must be filed with the
commissioner an application for

rP«jotpr
register

*pr>nritip*
securities

that

hv
by

I, J J l

V~. l, l

I,.

vV/

■

VJV/V>001

service

process

Registration of securities by qualification does not become effective
mmmi^innpr

ha*

taken

Electa^heating ^^STto^egfste^he

Objections
sells
threezone
lighting
glass
Many years ago, when I was bowls and some home lighting fixstarting out in the securities busi- tures. Its products are distributed
I

ness

tried

proaches to

find

new

ap-

the

selling problems
One day I was sitting at my desk laboriously drawing a chart that I thought was

that

came

up.

simplified. If memory serves,
something to do with the
book values, and the then
de¬
very

had

pressed

market

price of some of
City Bank stocks.
Finally I proudly took the com¬
pleted work of art over to the head
the New York

the

was

ever

firm

One

knew.

moment

and

Incidentally, he

too
the best salesmen I
He looked at it a

said, "What

you

securities in a Register of Securities and has notified the applicant
of such registration.
Securities
throughout the United States.
issued by seasoned companies
The corporation was incorpo- which meet earnings standards

Sky Laws

Adams,

Stock Exchange.

6
the

Norwich
Boston

this

connection,
the

York

significant

model
facts

should

has

vital

self-interest

Prevention of fraud in the
'Purchase and sale of securities
*n

because the industry as a whole
suffers a loss of public faith from
such fraud and
,.

...

individual

{*rn? can continue in the securities
business only by maintaining a

J**

*1 ^

•

fmms who are willing to risk their
business reputation and expulsion
*rom tbe business for

few fast

dollars. This fact has been recog-

3ra"L

p„r,esI"

AdmtaMr^?Pre°

^Administrators Bres
,

the

commissioner

registered

mail

ors

posting

properly

dressed to the commissioner.

adThis

of the

request

the

that

United

48.58%

publicly owned

preferred

States

stock

the

owned

are

com¬

nine

fraud

of the

This

type.

simpler

or a

dealer-regis¬

concentration

ownership cannot be attributed

large

institutional holdings in

nine

states
that

the

because

49%

the

study
share¬

at the Portland conventlrm

aIconvention

tration

are

those

this

ownership

attributed

the

nine

concen¬

cannot

greater popula¬

tion of the nine states because the
total

population

slates

under

the

those

1950

nine

census

was

41,228,000 while the total popula¬
tion

eleven

the

principal

states which have the qualification

type blue sky law, in which only
23.30% of publicly owned common
and

preferred stocks in the United
owned,

are

43,841,000.

was

In these nine states which have
the

notification
type law or a
simpler type law, in which most
of the

principal securities markets

located

are

the

owned,
and

and

sky

state

of
are

the

sale

these

are

blue

present

protection

those

the

Since

stock

authorities
the

and

by
in

48.58%

preferred

with

laws

forded

which

owned

believe that the public

the

satisfied

fraud

and

publicly

common

laws

af¬

against

of securities.

facts

lead

the

inevitable conclusion that the

no¬

tification

the

type

achieves

law

protection of investors against the

perpetration of fraud in the pur¬
chase and sale of securities with
minimum

restraint

the

legitimate conduct of the securi¬
ties business by reputable
we

dealers,
strongly recommend the adop¬

tion of the

tification
the

model law

type
of

model

of the

no¬

preference

the

qualification

type.
The

IBA

would

welcome

the

opportunity to cooperate with the
state securities commission of any
state in

amending an existing blue
sky law to remedy the problems
outlined

above

enactment of

sky

law.

g
Virgini®)
tke Oklahbma City convention last year

request

stated:

able

....

States

furthermore,

investment banking in-

"'ze<5
d
"j

recent

Brookings

Stock

indicates

and

States

favorable

the

Ownership in

United

™

members

a
.

states;

law,

type

•

any
n.

acci¬

holdings of publicly owned com¬
mon
and preferred stock in the

dutj®4tte'

Street,

historical

tration

qualification type model

This is

type.

dealer-regis¬

states which have the notification

noted:

rated in New Jersey on March 26, may be registered "by descrip™IfmRHes of fhe
1946, as the Appleman Art Glass tion,"
a
simplified
procedure
ciiw
Works, Inc., and changed its name under which registration becomes bec-uriiies mausiry, states
'It is conceded that the above
to the present title on Aug. 25, effective and securities may be
"Tf
"
sold by any registered dealer as recommendations do not apply to
1952soon
as
a
registration statement 99 %
the securities representaand
payment
of
the
required tives. It is only to the few marJoins Kinsley & Adams
registration fee (and a consent to ginal operators that the message
(Special to The Financial Chronicle)
service of process, when required) should be directed.^;:
WORCESTER, Mass.—James B. are filed with the commissioner,
Similarlv
PrP*iHpnt
wiiiia™
Kenary, Jr. is now associated With either by delivery in the office of
™V.u
?
Kinsley

the

have

law,

climate.

United

and

dustry

chasers thereof.

consent

manufactunne
.

type

fraud

States

which

essarily gravitates to

mon

law

^w0

em¬

type

Business naturally and nec¬

dent.

notification
the

are

the United
states

geographical

indicates

sale

filed

work

Jrat^"fete'

capital.
TTM

law

the shares of

sev-

notification

States"

Mewing

securities in the state would work

Elecfriglas Stock

the

"Share

consisting principally of the regis- the commissioner or by mailing by model law is specifically designed
tered U. S. trade mark "Spa-King" registered mail properly addressed to permit the use of the uniform
and of the trade marks "Spa- to the commissioner; filing for all application form
in
registering
King" or "Spa-King Mount Cle- other securities is completed only securities which are being or have
mens" registered in various states by delivery in the office of the been
registered under the Federal
and of its formula and
process commissioner.
The commissioner Securities Act of 1933.
(unpatented) for the manufacture can at any time issue an order
In making a choice between the

the

submit

notification

the

markets

law

The IBA Model Bine

water forbidding

fraud

Exchange and
published in the booklet entitled

page
f

the

would

requirements

located

the

forbid

which

thereof.

are

acquire

right to

(2) Most of the principal securi¬

New

Joe Dohadio

on JVly Continued jrom

mixer,

(ii)

type of blue sky law
Walt

the

tend to work

Institution

5 POINT CLUB

commence operations, for advertising, for the payment of certain
obligations,
and
for
additional
working capital.

«,.

sure

and

ties

(i)

engage

study prepared by the

un¬

which

blue sky law.

tration

SECURITY TRADERS ASSOCIATION OF NEW YORK

but

who

activities

such

simpler

Winn £ f!n (|((orc
WIIISII (X UUi UII6I9

that

conduct

without

securities

bodied
President:

should be used. The best selling
is based upon finding out where
the other man's interest lies. Then
appeal to this interest. Help him
to develop a buying urge. If "selling

C. L. Wallingford

effective

administrator

purchasers

can

which permits

one

persons

work

0± the stock are intended to be registration containing specified fecord of integrity and fair deal~
eral weeks.
Those stunts, too, are used to pay $60,000 due to crediinformation, a prospectus meeting
The source of most fraud in
not for the investment business. tors of the company; $40,000 for
prescribed requirements, payment
Purcbase and sale of securiWhen a man invests his
money he £ay™^nt. of taxes; approximately
f
examination fee and a reeis- ties lies in Promoters who are not
isn't going to be pushed into
any- $60,000
to reduce accounts paything with a barrage of high pres- abl?; and the balance for working
Service of orocess
two

every

in the business of selling

engage

below their book values.
Good

the

securities

Inciden¬
stocks are still

1jsuf of 300,000 shares of common
^tock (Par 10 cents) of Electriglas
c°rp. at $1 per share.
The ne- Pr0™eds from the sale

prospects.

that

would

restrictions

fraudulent

got the point.

are offenng "as a speculation"

Others have used

that

sky law is

enables

to their

in the market compared

the

envelope with advertising litPossibly they feel that the
quantity of it alone will over-

unwilling

conclusion

necessary

erature.

their

state

dealers

-power

business

salesmen stuff

some

the, beginning

Recognition of this fact leads to

„

seen

legitimate

better.
I have

nature of the securities they offer,

reputable

you

interesting.
That's all

part

industry at all,
from the very

who,

stocks were then selling.
He replied, "Why put ideas into their

securities

know

the

those

value

book

Eit?™ r.f,?,Ltl;l?n„el°Se„d„ over it into
leisure when you can go aloftMount Clemens mineral
tasty table water and
carefully. I feel that

problems

segment

not really

are

those

blue

below

600 shares of common stock (par
1® cents) of Spa-King Mount Clefollowed it, combined with a tri- uiens Water Products Corp. at $1
pod full of pictures and selling Per sham
points, which this salesman read
H is intended to use the net pro¬
off one by one as we patiently ceeds from the sale of t*e stock to

any

the

but

much

would

evening

some sauce-pan

Sept. 23rd. The fol¬
nominating committee:

the

just

providing

those

presented

been

Traders

those

that

application to have them properly

believe

deftly handled.

very

attended

Philadelphia will be held

slate has

Investment

registered

||"

isn't

the

fruitless."

than

make,

very

thought

will

officers

impressive exhibit to place in
front of an investor, and that it
would show at a glance just how

that you will agree with me when
I say that it can kill more sales
it

I told him

making a point then use it. If it
because
he
feels
he
has
to
go can help you to establish confithrough with the thing or die try- dence in the fund you are offer¬
ing. You've seen that sort of a ing, use it. Don't abuse it.
interest

prospect's

that
with

heads?

is in his head.

1 ifprntnrp

chIpc

pages of
The rest of

pencil.

kit

blank

few

and

paper

his sales story

sales

lowing

election

annual

Association

Selling Literature
expect to do with it?"

been

people who

By JOHN DUTTON

One of the best securities sales-

shows

have

policing
experi¬

our

again

but

ence

NSTA Notes

Securities Salesman's Corner

have

problems,

Also,

for

any

information

obtain

complete
we

invite

other
that

the,
blue

new

your

assistance

may

to furnish at any time.-

Volume 176

Number 5152

The Commercial and Financial Chronicle "

The

Indications of Current

following statistical tabulations

latest week

Business Activity

week

IRON

Indicated

steel

Equivalent
Steel

Crude

and

Week

capacity)

castings

Week

Sept. 21

101.8

..Sept. 21

2,115,000

INSTITUTE:
"
condensate output—daily

and

each)

2,017,000

ALUMINUM
(in

2,023,000

Sept.

6.441.550

6,284,450

117,002,000

'7,110,000

6,265,850
6,909,000

Sept.
Sept.
output (bbls.)____;
;
Sept.
Residual fuel oil output (bbls.)
;
Sept.
Stocks at refineries, bulk
terminals, in transit, in pipe lines—
Finished and unfinished
gasoline (bbls.) at
Sept.

23,220,000

23,936,000

22,984;000'

2,531,000

2,664,000

2,604,000

10,612,000

10,253,000

10,178,000

8,732,000

8,882,000

8,839,000

8,856,000

output

(bbls.)

fuel

(bbls.)

average

(bbls.)

output

Distillate

oil

fuel

oil

(bbls.)

;

ASSOCIATION OF AMERICAN RAILROADS:
Revenue freight loaded (number of cars)
Revenue freight received from connections (no
CIVIL

ENGINEERING
NEWS-RECORD:

Total

Year

Month

Ago

MINES):

primary aluminum in the U.

tons)—Month

July___

(short tons)

78,368

IRON

AND

STEEL

72,698

13,753

11,369

8,499,000

*1,626,958

8,739,095

1,250)243

end of July

77,476

15,759

5,947,450

6,645,897

$42,096

aluminum

CONSTRUCTION

construction

anthracite

Beehive

'$42,450

$39,009

INSTITUTE:

FAILURES

AGE

000

Pig iron (per
Scrap

steel

METAL

746,044

727,344

782,171

y.pc.

58o,8/0

657,100

643,69T

$264,518,000

$109,956,000

126,482,000
138,136,000

57,239,000

75,127,000

52,717,000

162,373,000

36,332,000

84,816,000

41,567,000

53,320,000

11,150,000

56,739,000
105,634,000

23,746,000
9,290,000

$237,500,000

9,110,000

*2,230,000

9,540,000

698,000

152,000

59,900

29,700

47,000

102

Domestic
Export

100

110

refinery
(New

Lead

(New

Lead

(St.

Zinc

York)

Louis)

—

DUN

7,654,324

7,324,127

MOODY'S
U. S.

BOND

COTTON

COTTOV

116400

110

7,626,608

7,137,652

141

164

•

Piece

4.131c

Women's

*$55.25

*$55.26

$52.69

Infants'

$42.00

$43,00

Home

24.200c

34.800c

27.425c

Cotton

121.500c

103.000c

16.000c

17.000c

15.800c

16.800c

Sept. 10

14.000c

15.000c

97.50

97.17

109.79

114.08

114.27

116.22

112.00

112.00
109.42
103.97

106.56

106.74

106.92

109.60

109.42

112.93

113.12

2.70

.-Sept. 16

3.13

3.18

2.94

2.94
3.06

3.21

3.20

DEALERS

Odd-lot

sales

Number
Dollar

Odd-lot

3.02

3.01

3.00

424.5

428.5

437.2

269,531

Sept.

175,730

.—Sept.

EXCHANGE

456,005

short

109.43

108.96

116.53

Customers'
Dollar

Aug. 30

19,632

21,563

24,301

612,336
$27,804,822

697,736

$25,125,125

$32,123,853

' ug. 30

18,161

19.186

20,890

24,510

Short

Number

126

17.991

19,062

489;697

520,090

Aug. 30

—

3,776

tug. 30

4,749.

485,921"

—Aug. 30

$19,945,313

—Aug. 30
1:—-.———Aug. 30

sales
of

i_'-:Aug. 3(1

-——

purchases by

dealers—•

shares;

20,805

589,114'
2,837

ROUND-LOT
ACCOUNT

FOR

Total

—;

Other

sales

Total

•j.

ACCOUNT

FOR

4,691,310

4,345,920

Total

„

sales

Short
„..

—

Other

sales

Total

Railroad

2(H)

Other

458,600

538,450

Total

562,750

81,320

107,340-

130,680

98,740-

74, 700

NEW

10,900

NEW

>4,500

11,400

8,900

53,: 00

101.300

146,860

»:

112,700

155,760

175,745

207,570

203,035

.Aug. 23

17,690

13,640

43,670

Aug. 23

228,317

247,620

264,565

295,685

246,007

261,260

308,235

729,795

747.490

848,825

—A-Ug. 23

114;i20

116,880

179,770

715,577

719,500

803,915

$2.10000

24.500c

pound)—

ingot' (per

19.000c
24.500c

56.500c

19.000c

24.500C
„

AVERAGE

YIELD

56.500c

STOCKS—Month

Aug:
5.41

5.98

5.68

5.61

6.33

5.31

5.44

5.77

5.51

—

4.52

4.39

—;

(10)

—•

(200)

"«'■

4.67

3.15

3:21

3.20

5.46

—

5.39

5.86

BANK, LTD.—Month

STOCK

10,384,000

£7,948,000-

£6,465,000

$1,337,103

of Aug.—

$1,322,264

$1,265,897

EXCHANGE—

July

(000's

firms
of

omitted):

carrying margin

customers

net

Aug. 23

829,697

836,330

983,685

1,201,685

extended

Credit

hand

accounts—
balances

debt

and

customers

66,759

32,051

43,054

335,336

362,979

691,949

713,874i

378,300
825,187

115,824,575

114,488,919

104,609,682

100,273,060

banks

95,964,179

98,457,150

307,021

210,346

87,693

1,156,400

951,841

705,114

Total of customers' free credit balances—
Market value of listed shares

1,026;735

—

SERIES

—

—-——

DEPT.

—

Market

value

Member

borrowings

UNITED
>

111.5

—Sept.
Sept.

107.2

*111.7

STATES

August

*107.9'
*110.7

110.8

Net

110.0

110.3

115.0

112.6

*112.8

112.7

runs.

Govt,

issues—

other collateral-

GROSS

DEBT

DIRECT AND

omitted):

31—

$263,224,860

balance

debt

Computed

116.4

Sept.

lilncludes 690,000 barrels of foreign crude

fund

bonds

$263,106,924, $256,676,556

6,952,146

7,925,452

5,094,809

$256,272,714

$255,181,472

$251,581,947

112.0

—-Sept.
foods

listed

borrowings

General

-—:

Member

GUARANTEED—(000's

100):

$2.80000

19.923c

pound)

(per

(125)

YORK

Cash

174,950

Aug; 23

113.7

figure,

$2.67500

$2.40000

$2.40000'

CAPITAL ISSUES IN GREAT BRITAIN-

1.080,642

All commodities other than farm and
*Revised

plus, ingot

(15)

Total

325,235

foods

99%

(24)

Member

271,962
29,550

Aug, 23

———

products

Processed

$2.07500

commodities

Farm

$2.32500

$2.15000

$2.40000

97,600

—:

$2.55000

74,400
85,300

Commodity Group—
All

$2.25000

MIDLAND

Aug. 23

—-—

NEW

$2.00000

42.000c

—Aug 23

PRICES,

$90,000

(25)

Average

720,690

——«———

LABOR—(1947-49

;•

$90,000

ounce)

(per

136,500

477,520

85,530

Aug. 23

sales

WHOLESALE

42.500c

$90,000

Insurance

678,000

124,700

498,390

—

sales

42.577c

COMMON

Banks
,

.'—Aug'. 23

—

-—:

42.077c

479,350

initiated off the floor—

sales

45.307c

39)000c
39.500c

Industrial

6,412,440

\ugi 23

—

——

purchases

Short

$35,000
$195,852

bulk, Laredo:
in cases, Laredo

WEIGHTED

234,490
6,147,950

Total round-lot transactions for account of members—
Total

102.000c

$35,000
$189,608

56.500c

219,550

Aug. 23

120.500c

$35,000

$187,000

pounds)

pound)
pound)—:

t futilities

.Aug. 23

—

103.000c

pound)

the floor—

—

purchases
sales
sales

17.500c

121.500c

42.470c

(per

5,467,210

584,190

——

Other, sales

78.500d

$2.79921

15.000c

42.470C

(per

5,247,660

438,050

Short

Total

72.609d

$2.78827

14.061c

(E. & M. J.)—

97
Aluminum,

•

90.160c

73.000d

pound)

148,150

378,780

transactfons

of 76

§Cadmium

MEM¬

sales

Other sales

Total

82.886c

$2.78830

ounce)—

Louis

price)-

(per

5,291,020

412,860

-•

—

purchases

16.800c

83.250c

pound)

refined

5,142,870
'

:——i—.Aug. 23
——;
—-—Aug. 23

■---—

Other transactions initiated

15.051c

120.500c

per

St.

XCadmium

154,610

Aug. 23

——

sales

17.000c

15.257c

(per

tCadmium,

MOODY'S

BERS, EXCEPT ODD-LOT DEALERS AND SPECIALISTS
specialists in stocks in which registered—
purchases
t———?—_———)——
—Aug. 23
Short

flask

(per

Transactions of

Total

27.425c

16.000c

**Nickel

Aug. 23

TRANSACTIONS

KOUND-LOT

24.200c

34.815c

15.800c

min.

99%

ounce,

Magnesium,

4
Aug. 23

—

York,

(per

(per pound)

sales

24.200c

pound)—

(per

Antimony
Platinum,

295,400

104.2'

24.200c

(Check)——

Antimony

273,750

102.9

121.500c

(pence

Exchange

689,896

233.480

107.4

100.7

34.904c

—.

pound)—East

$27,855,249

:?;»

101.2

105.5

(SHARES):

sales

Other sales
Total

OF MEMBERS

refinery

Cobalt,
220,310

102.8

QUOTATIONS)—

York

586,227

222,600

106.5

125.6

August:

Louis____

$24,478,557

sales—

Round-lot

Short

•

SALES

refinery

515,341

18G!740

108.0

117.4

102.3

—

$21,622,815

150,740

112.5

105.1

London

(per

HAntimony

149*240

—Aug. 30

—

STOCK

St.

Quicksilver

THE NEW YORK *
EXCHANGE AND ROUND-LOT STOCK TRANSACTIONS

TOTAL

New

Gold

222,600

102.7

111.1

107.8

Sterling Exchange—
New York (per ounce)

7.448

186,740

102.3

102.9

and

§§New

211

102.9

117.4

New York Straits

*■

month
domestic

Sterling

24,299

150,740

pound) —

(per

Zinc

697,344

149,240

———

sales

Other
Round-lot

110

i'g. ^0

Aug. 30

——i—

(E.

for

(per pound)

export

Tin

——

112.5
;

101.0

Silver,

766,124
$33,035,435

sales)—

103.9
*1)

102.3

_—

——

appliances

Electrolytic

26.153

548,682

100.4

108.4
"

102.9

Silver,

—

by dealers—
shares—Total sales

104.3

—

household

Common,

6ales

Number

100.2

103.8

—

Common,

ug. 30

sales

_u——

Electrolytic

Silver

value

Round-lot
;

other

102.7

100.3

,—,

PRICES

Lead

-•

sales

sales—

sales

110.6

102.4

and children's wear—

Average

STOCK

sales——'—:—

Customers'

107.0

110.4

102.4

caps—.

;

Copper

566,141

109.11

sales—

other

shares—Total

110.1

106.5

100.5

METAL

COMMISSION:

(customers'

Customers'

102.0

108.9

110.7

and

Electrical

388,360

\ug

Customers'

Number

100.1

Luggage

purchases)—

total

100.7

neckwear—

and

Furniture

161,170

\ug. 30

dealers

95.5

100.0

Floor coverings

262.017

480,274

233.200

220,763

224,724

of orders—Customers'

99.9
108.0

apparel—

Radios

INDEX—

of orders.

purchases

216.985

.•

72..

98.4

97.5
107.3

110.4

452.0

95.1

97.5
107.7

brassieres

(jnaeiwear

2.89

Sept.

PRICE

(customers'

95.2

housedresses

102.9

3.26

Sept. 12

by dealers

124.7

China

109

SPECIALISTS

111.8

120.3

.__

Infants'

3.07

Sept.

AND

100.7

120.2

107.8

3.45

3.34
3.20

.Sept

value

Number

3.51

3.35

3.19

Number of shares

3.51

3.36

Sept. 16

EXCHANGE—SECURITIES

102.4

3.14

3.20

STOCK TRANSACTIONS FOR ODD-LOT ACCOUNT OF ODDLOT

92.9
114.6

94.6

100.1

comforters

and

Shirts

2.88

Sept'!, 16

REPORTER

89.6
108.8

94.6

2.?A

3.06

Sept, 16

;

DRUG
=

89.8
108.0

Underwear

3.08

activity.

PAINT AND
1949 AVERAGE

106.3

111.5

2.58

3.19

103.1

105.6
107.7

Clothing including overalls—

2.67

100.9

104.8

106.7

115.24

2.71

OIL,

106.2

108.8

111.44

112.75

101.8

Underwear

Hats

period

101.7

107.7

108.34

109 42

Sept. 16

—Sept. 16

107.2

94.0

Men's

AVERAGES:

at end

96.7

Furs

105.00

Sept. 16
z

(tons)

and

Corsets

110.52

103.97

Sept'

NATIONAL PAPERBOARD ASSOCIATION:
Orders received
(tons)
;
Production (tons)
orders

105.1

apparel—

Aprons

Ho.43

109.24

3.53

Unfilled

wear—

—;_

Blankets

111.62

3.22

Percentage of

15,212,000

106.0

goods

Sheets

90.85

109.60

INDEX

14,735,000

PRICE

(COPYRIGHTED)

Hosiery
97.12

Sept. 16

COMMODITY

1,889,000

RETAIL

wash

Women's

AVERAGES:

3.07

MOODY'S

Domestics—

17.500c

Sept. 16

Group
Group

Sept.

_i_

children's

Woolens

34.575c

?ept. 10

Group

bales

gross

2,013,658

and silks

24,200c

Utilities

DEPT.

apparel
and

34.975c

2.95

Railroad

goods—

Utilities

Industrials

1,413,099

—

furnishings

103.64

Public

609,000

95.2

$42.00

Sept. 10

prior

104.7

*$55.26

Sept. 10

Average corporate

1,444,663

105.5

Piece

Government Bonds

6,138,900

*432,523
1,872,764

1,957,982

apparel

109.06

U. S.

6,747,900

5,373,630

goods

Men's

at-

DAILY

►5,806,153

Sept.

$69,442

COMMERCE):

linters)

1935-39=100

As of August
Composite index

Rayon

YIELD

500-lb.

—

Sept. 10

Group
Group

PUBLICATIONS

INDEX

_Sept. 10

Group

(net tons)

;

4.376c

111.81

BOND

(DEPT.

(excl.

4.376c

DAILY

of month

100

J. QUOTATIONS):

PRICES

'$69,914'

5,535,222

_—^

PRODUCTION

Production
(

Sept. 16

MOODY'S

bales

Sept.

20,282

425,645

___;

tons)

stocks at end

GINNING

September

•J#

10,151

*17,997

5,960,867

tons)

(net

4.376c

Aaa

Industrials

(net

Government Bonds

Public

tons)

coke

*9,467

17,737

62,586,000

Average corporate

Railroad

coke

Beehive
Oven coke

Sept. 11

(East St. Louis)

(net

FAIRCHILD

ton)

York)

June

MINES)—Month of May:

AGRICULTURE—Estimates

Sept. 13

refinery at

tin

$69,340
OF

kSept.

Month

—

9,507

(BUREAU

Oven

892,000

RESERVE

6ept.

INDUSTRIAL)

ton)

$189,224,000-

Electrolytic copper—

Straits

SERIES

OF COM¬

713.000

AND

DEPT.

—

Running

PRICES:

gross

(E.

INVENTORIES

Total
COKE

Sept'.

kwh.,).

alloy

614.72&

100

including

tons)—Month of May

Wholesale

732,769

-Sept.
Sept.

„j

lb.)

gross

(per

PRICES

—

COMPOSITE
(per

(net

NEW

castings produced

August:

Manufacturing

MINES):

INDEX—FEDERAL

AVERAGE

(in

steel

49,458,000

Sept. 11

(tons)

(COMMERCIAL

Finished

51,302,000

INSTITUTE:

BRADSTREET. INC.
IRON

52,296,000

SYSTEM—1947-49
output

53,275,000

for
of

products,

(millions of dollars):

34,400,000

Sept. 11

DEPARTMENT STORE SALES

Electric

97,219,000

steel

stainless

MERCE

124,584,000

Sept. 11

(tons)

ELECTRIC

90,035,000

Sept. 11

BUREAU

Pennsylvania

EDISON

117,248,000
28,808,000

102,2)5,000

.Sept. 11

Bituminous coal and lignite (tons)coke

32,080,000

105,326,000

r«>

;

117,240,000

33,374,000

Production

—

COAL OUTPUT (U.

116,830,000

steel

construction
State
and
municipal

Federal

and

BUSINESS

and

tons)—Month

Shipments

ENGINEERING

—

ingots

(net

<■

Sept.

Public

Retail

construction

Private

6,705,000

..Sept.

Steel

22,1^6,000

Sept.

(bbls.) at
Distillate fuel oil (bbls.)
Residual

6,278,200

Sept.

Kerosene

•-

of that date:

8,865,000

stills—daily

Kerosene

short

AMERICAN

2,620,000

runs

Gasoline

•

(BUREAU

;

are as

Moiith

101.2

Sept.

Crude

either for the

are

Latest

Stocks of

(bbls.

average

of quotations,

cases

Ago

97.1

*2,033,000

real

Ago

*100.8

Dates shown in first column
or,

production and other figures for the

cover

that date,

Production of

tons)

(net

Montb'

PFfROLEUM

oil

gallons

operations (percent of

to—

Ingots

AMERICAN

STEEL INSTITUTE:

AND

month available.

month ended

pr»«notir

AMERICAN

(1047)

*Revised
the

—

annual

figure.

rate

tBased

contained.

2.339%

2.345%
on

the

producers'

producers' and platers' quotations.
Colburne, N. S., U. S. duty included.

SBased
ttNot

quotation.
on

platers'

including

XBased

quotations.
Tel. &

Amer.

2 231%

the average of
UDomestic, five
Tel. Co.

000 resulted from the sale of new

Bank Stocks

Investment Status oi

by the industry in meeting
rising costs and more will be

made

earnings will be an index of na¬

they used to be
made in the future. It is my opin¬
For¬
tunately the Federal Reserve is ion, therefore, that bank stocks
are
favorably priced
favorable to this point of view presently
and in time may exert effective compared with most other types
of equities.
While their growth
^influence.
On a price basis, bank stocks prospects can hardly be character¬
ized as dynamic, it is a failing
are reflecting the problems of the
tional growth

they should now be.

therefore carry a
fewer degree of risk than other
and

industry

factors

temporarily favorable.

are

There

of bank stocks,

of its

tion

which

basic

stable banks of the East, a grow¬

and

economic

our

Progress has been

Continued from page

to 1912

Assistant Treasurer of

was

City,
Hudson County National

the Union Trust Co. of Jersey

He was a trus¬

Hankers Trust Co.

the

now

1912 to 1920 he was

From

Bank.

Examiner and Assis¬

Bank

State

Bank¬

tant to the Commissioner of

Uni¬ ing and Insurance of the State of
versity and during the course of New Jersey, except during World
Obis association with Princeton was War I, in which he was a captain
ior several years Chairman of the in the U. S. Army. In 1920 Mr.
JFinance Committee of the Uni¬ Mayham was elected Comptroller
He

versity.

Princeton

emeritus

tee

also a life mem¬
of

was

Officer

Trust

and

Side

West

Co., Newark, N. J., of which
became
a
director in 1922,

ber of the New York Academy

Trust

-Science.

headed by Blair, Rol¬
Inc., is offering 17,104
of capital stock (par value

A group

Franklin

of The

jfclG per share)

Itfational Bank of Franklin Square,
W.

$51

priced

Y.,

"These

share.

per

offered

being

are

Vice-President

President

been

1924, and had
Chairman

and

of the

one

was

South

organizers of
Bank

National

Side

1928.

the Board of directors since

and

Trust Co. of Newark in 1925, serv¬

ing

Vice-President until 1928,

when

was

became

"Trust

First

stockholders

Park,
purchased

Floral

Company

"IN. X. The stock is to be

4rom

Bank

National

First

The

President,

and

-of

Floral

accrue

stock

The

Franklin

The

4Bank.

this

sale

Floral

-Engaged

^business

similar

National

Park

Bank

general

banking

that

Hranklin National.

will

the

Upon comple¬

tion of the consolidation, the com¬

bined bank will have

resources

was

Vice-President

1928, when he was elected
President, and remained as Presi¬
dent of both banks until they were

merged with West Side Trust Co.
in

1934.
When

and no proceeds House

Park,

the

until

national Bank & Trust Company
■from

Newark

the

Association

Clearing

organized

was

1922, Mr. Mayham was a mem¬
organization committee

ber of the

served

had

and

Vice-President

Treasurer,

President

and

Other members of the purchase

included W. C. Langley &
Co.; Hornblower & Weeks; Grimm
-fc Co.; Boenning & Co.; and Hallowell, Sulzberger & Co. An item
bearing on the proposed merger

^group

cf the two banks appeared in our
issue of Aug. 14,. page 572.

House, and a member
Clearing House Committee

since 1931.

He also has served

President

the

Essex

County

activities

Board

the

J.,

died

Sept. 13 at
Rest, at Cox-sackie, N. Y. Born in Jersey City,
in 1882.
Mr. Mayham graduated
from
Friends
School,
Rahway,
J.
and
Centenary Collegiate
Institute, Hackettstown, N. J. and
Colonial

later

Terrace

took

Mr.

member

New

courses

the

Amer¬

ican Institute of Banking. He en¬
tered the banking business in 1899
as a clerk in the Equitable Trust

fCo. of N. Y. City, and from 1910

Mayham

Jersey.

had

Bond

the

three

been

Club

children

Mr. Mayham leaves two sons Ray
E. Mayham, Jr. an Assistant VicePresident of West Side Trust Co.,
and

Robert

Mayham, of the
Bank of America, of California.
*

•Vest Side Trust Company of New¬

ark,

Among his numerous other

the

A Few Powerful Men!

in Europe.
Only, as
10 named Carl F. misguided few so easily steer us
of the bank down the course of nationaliza¬ we will outdo them.

Americans,
We

President

according
A. J.

19,

Aug.

who tion, socialism or collectivism.
If that happens, gentlemen, the
to an

always

Instead of six million gov-*

have.

Giannini,

succeed

died

Dictatorship oi

S. A. of San Fran¬

cisco, on Sept.

ernment

million

workers, we'll have ten

And that means
that we will be asked to support
Mrs. automatic. The people will break
somewhere
between 40
and
50
Claire
Giannini
Hoffman,
Di¬ up with violence the most insidi¬
ous monopoly of all,
the out and millions of people whose entire
rector, sister of the late L. M.
out
economic dictatorship of a income will come from the gov*
was named to the Board's Execu¬
second

of trust-busting will be

era

by 1960.

Board.

the

Chairman

Gock,

announcement

Mr. Wente, who few politically powerful men

tive

Committee.

had

semi-retired three years ago

overriding

are

desires

your

Mr. Wente began as a mes¬

but a man who exercises more
boy with the Central Bank control over this country than the
Shortly after he went
President, the Congress we elect¬
to his home town of Livermore,
ed, and the officers appointed un¬
Cal. to work in the local bank,
der the government.
but in 1918 he joined the Bank of
The
President
of the United
America at its Madera
Branch,
States agreed to a plan to settle
shortly after becoming a Manager
the controversy in the steel indus¬
and serving as such in Visalia,
try. He knew, and told me, that
Fresno,
Modesto
and Stockton, it was a
just solution, that was the
finally being designated as Super¬
best
possible for all concerned,
visor of Credits for the
entire
and all concerned, mind you, were
Bank of America system.
Later not
just the workers in the steel
he was borrowed
by the First
industry nor the management and
National Bank of Nevada, to serve
shareholders of that industry. In¬
as
its President for three years,
cluded were all the people of this
after which he was called back
country; yes, even the troops on
to Oakland as President of the the battlelines in Korea.

recognized the interdependence of
all of

rights and responsibilities.
Arewe abrogating those rights by in*
action and tracking in the bum¬

Central

Effective Aug. 27 the First Na¬
tional Bank of Cameron, West Va.
increased its

started his career as a messenger.
In

dency

$200,000

of Aug.

affairs

capital from $100,000
by

28, page 751.

result

from

$150,000 has been

capital of the Farmers
of

$100,000,
stock

which

increased

the
to

capital

$250,000

of Sept. 12. Part
brought about
dividend of $100,000,

of the increase

issue

our

President

National

First

Ore.,

Portland,

Cor¬

death of L. M. Gian¬

ated by the

elevated

Board

The

Vice-President

from

and

prior

years

President of

being

The

First

President of Central Bank

of Oakland from 1943 to 1947 and

President of Pacific National Fire
Insurance

1943.

$50,-

all that

these

was

director and Vice-

Occidental

Life

In¬

California

Company

surance

from 1933 to 1946.

Andrews,

has

1930

and

dent

since

continue

director

been

March,

the

Vice-Presi¬

1940.

realize

program

just

belong

task

The

And he did it without

called.

the back of all of

agriculture, and industry.
there is widespread

labor,

when

Only

that

realization

the

road

are

failure,
be able to start

following, is the road to

only then will we
towards sanity.

back

H. R. O'Neil Jr. Is

re¬

Willi Fairman & Co.

citizens.

our

(Special to The Financial

the

material

war

vital to the security of

Bank

Los

mem¬

bers of the

Los

Angeles
Ex¬

Stock

O'Neil

was

is powerful and political¬

ly well placed to fasten his selfish

Pierce, Fenner

p r e v

justice and fair play

with

for all Americans—even if the ad¬
versary

demands
I

for

America?

believe

one

us.

This

one

that

do.

easy

geler & Co. In

job—nor

the

be done quickly, but

following

all the
don't

series of

1934

own

investment

Sills, Fairman Wire

angles, including those that

seem

to favor their

tunes of the moment.

own

for¬

We cannot

can

see

this
the

roll.

how

vested

people

have

interest

from

Toronto, Canada

CHICAGO, 111. —Sills, Fairmark

fallen

lassitude.

mire

We have

& Harris, Inc., 209

six

members of the Midwest
Stock Exchange, have established
a direct wire to Bunting & Skaith,

the public pay¬
permitted a hand¬

members

and

union
The
us

members.

;

precedent has been set for

in almost all of

South La Salle

Street,

Angeles, out economy to suck the courage

promotions he was elected Assist¬
Vice-President

O'Neil, Jr,

business in Los Angeles.

the

Toronto

Stock

Exchange, Toronto, Canada.

With Paul H. Davis

bookkeeper regard the rights of all of us, in¬
cluding the rights of their own
a

his

conducted

have to light the spark of un¬

Hubert R.

pasthe

(Special

and

Beane

Dempsey -Te-

lot of fight within

not

can

that

proud people like a Vam¬
pire bat. We have encouraged a
of service with the bank A native
false job security which permits
of Iowa, Mr. Mendon started with a handful of labor leaders to dis¬
California Bank

Mr.

change.-

i o usly
Barbour,
Smith & Co.,
Merrill Lynch,

battle for

have

Street,

states¬

210 West
en t h

Co.,

the nation,

What kind of business

;

Fairman &

than two months.

with

ciated

nation, we lost two months' steel
production and set back our pro¬
duction

Chronicle)

Calif.—Hubert
O'Neil, Jr. has become asso¬

LOS ANGELES,

into
*

Cal., has completed his 30th year

ant

man

will be both strong and selfish.

Treasurer

corporation.

1922

And

doesn't
to them.
ahead is much too big

railroads'

The

happen

opposed to the government's own
plans to sustain the economy of
the country in a time of national

million

carrying the

are

us.

derstanding. An awakened people
of are strong, but they must look at

Transamerica, has been connected
with the company since March,

the

look?

ownership.

was

this

man,

Company from 1930 to There is still

President

Mr.

not successful in
efforts, inevitably they will
headlong
into
government

fall

just that. I could no longer toler¬
ate the atmosphere that permitted
so brazenly selfish an act—an act

ap¬

National Bank of Portland in 1947.
was

are,

if they are

courage

that

pointed R. A. Peterson of Los
manship is this anyway? Why in
Angeles
a
Vice-President.
Mr. the name of common sense and
Belgrano has been associated with fair
play do Americans permit
the Transamerica organization for
this? Don't we have the

was

while the further addition of

single

even

Vice-President

named

they

all

for

Bank

poration to fill the vacancy cre¬

over

think

ball

Transamerica the

Transamerica

Directors

nini.

time

same

gard for the hardships he caused
people he put out of work,
without regard for the troops in
subsidiary, has been elected a di¬
rector and member of the Execu¬ Korea; and with full knowledge
of the dagger he was holding at
tive Committee of the Board of
The

and

are,

applaud the Eastern railroads.
I recognize that they are fighting;
in their own interest, but at the

Frank N. Belgrano, Jr.,
of

Board

the

stock dividend

National Bank of Shelbyville Ind.

been

isn't it time that we took

That one
Cavagnaro, Chairman peril, and I resigned.
of
Transamerica man gained his ends through the
steel
strike
that
he
personally
Corporation has announced that
James

California
An addition of

in¬

H. J. Mendon, Vice-President of

made to the

noted in

was

that

death

The

Giannini

the

directing
stitution.

$100,000.

has

Vice-Presi¬

Bank of

the
with

work

bling footsteps of millions abroad?

But the solution did not happen
to give

people; it gives all of us

our

wanted to one
for the railroads.
It is much toowho is able
to ride roughshod over the Presi¬ big for all of American business.
It belongs to all Americans — to
America, dent and the people. And he did

relinquished that post

1943

to take on the Senior

he V had

where

Bank,

Senior

Kay E. Mayham, President and
of

N. T.

Wente
to

Directors of the Bank of Amer¬

ica,

Andrews

1946.

UFarmingdale.

Chairman

page

of the

$139,642,000
and Bankers Association, and for eight
-deposits of approximately $128,- years was Chairman of the Fed¬
*159,000.
The Floral Park Bank eral Reserve Relations Committee
will be operated
as
the Floral of the N. J. Bankers Association.
VPark office, adding a fifth branch He was appointed a member of
fto the four now operated by The the State of New Jersey Banking
'•Yanklin
National, viz: Elmont, Advisory Board in 1942 by Gov¬
Hevittown, Rockville Center and ernor Edison and served until

from

We Have

Sept. 9.

became effective

capital

the Clearing

approximately

brought about by the sale of $100,000 of new stock.
The enlarged

organizer of Peoples

which

national Bank of Franklin Square
the

Continued

Seattle,

Banking

$250,000 to $350,000, has been

from

also

jsubject to the effectiveness of the National Bank of Newark in
1926,
consolidation
of
The
Franklin
and

capital of the Marquette National
Bank
of
Chicago, increasing
it

School

in Oakland.

Committee of
American Enka Corp., National
biscuit Co., and Bankers Trust Co.
He
was
also
Chairman of the
"•Trust Investment
Committee of

Wash.

1907

Executive

the

cles, Mr. Mendon is Prasident of
the California Bankers Associa-

$100,000 to the

addition

senger

Mews About Banks and Bankers
«of

tion and Chairman of the Board
of Directors of the Pacific Coast

Active
cir-

1940.

The industry is aware of
its problems and while they are
-difficult ones, they will be met.
interest
rates
may
again turn
<lown but are most unlikely to
•return to the absurd levels of a
#$>stem.

«ew years ago.

in local and statewide banking

•»,
who ernment.
and
"It Can Happen Here"
^
ing proportion might be devoted at the
mine, men who are holding the
age of 60, relinquishing his
If this is crying wolf, then I sug*
to the Middle West,
Southwest,
very
destiny of the country in
post as Senior Vice-President but
gest that we look more Closely at
and the Farwest.
The virtues of
their hands.
;
continuing
as
a
Director and
the not so happy plight of the peo^
such stocks as First National of
member of important committees,
Single Man Controls Nation
pie of France and England; Per*
Boston,
National City and the takes the Presidency with the
I have had some little experi¬ haps, we too had better reexamine
Guaranty Trust can be enhanced
support not only of all directors
one
of
the
greatest documents
by
balancing
commitments in but also of the bank's Managing ence with this kind of dictator¬
others such as Republic National
ship, and I was overruled by a ever composed that was > drafted
Committee, headed by S. C. Beise,
to set forth a set of rules) which
of Dallas and Security First of
single man who was never elect¬
present Senior Vice-President. In
Our Constitution
ed or appointed to national office, once guided us.
Los Angeles.

be in the

worth, which has

net

balance should be
While the bulk

holdings may continue to
strongly capitalized and

of your

protected return, which sells
dfor less than a reasonable valua¬
*vell

gradual longer-term growth,

watchword.

the

great deal to be said for an
investment which pays a sound,
is

over-em¬

phasized at this stage of the busi¬
cycle.
For the selection of a portfolio

which

measure

ness

industries in which security prices
are

not

should

which

Vice-President

stock.

Continued from page

©nd

Financial Chronicle... Thursday, September 18,1952

The Commercial and

(1048)

to The Financial Chronicle)

ROCKFORD, 111.—Paul A. Kent
has
.

joined

Davis

the countries Building.

the

Co.,

of Paul BL
Rockford
Trust

staff

Number 5152

Volume 176

...

The Commercial and Financial Chronicle

ADDITION!)
ISSWl

Ar INDICATES

Now in

Securities
Admiral Corp., Chicago,

Registration

(par $1) being
Canadian Ad¬
share of Admiral stock

miral Corp., Ltd., at rate of one
for each two shares of Canadian Admiral

stock

September 22, 1952

Allpark Finance Co., Inc.

(9/24)
sinking fund convertible
10-year debenture notes due June 30, 1962; 29,180 shares
of 60-cent cumulative preferred stock (no par); and
22,347 shares of common stock (no par). Price—For
debentures, at face amount; for preferred stock, $10 per
share; and for common stock, $5 per share. Proceeds—
For additional working capital. Underwriter — For
debentures, C. K. Pistell & Co., Inc., New York; and for
preferred.and common stock, none, with sales to be made
through Marion R. Allen, President. Office—Houston,

(Bids

(Bids noon EDT)

Common

September 23, 1952
(Bids

Texas.

Bonds & Notes

San

Preferred

Co.

(Dean Witter & Co.)

American Metallic Chemicals Corp.,

(Bids 11

Bonds & Pfd.

Aug. 20 filed 450,000 shares of common stock (par one
cent). Price — $3 per share. Proceeds — To lease and
equip plant for manufacture of sodium perborate tetrahydrate and for working capital. Underwriter—Dobbs &

Proceeds

Electro-Components Corp. of America

Common
Common

be named)

(Underwriters—To

and the other half to the Dollar interests.
—To

(C.

Underwriters

Common

for

such

(Offering

division

(Barrett

Inc. (10/2)
Sept. 11 filed $35,000,000 of debentures due Oct. 1, 1977.
Price—To be supplied by amendment.
Proceeds—To
prepay outstanding bank loans and for expansion pro¬
gram. Underwriter—Dillon, Read & Co. Inc., New York.

bank loans and for
be

new

Herrick

Co.,

Inc.)

Consolidated Freightways, Inc.
(Blyth

Honolulu

Inc.)

& Co.,

Bonds

(Bids to be invited)

Washington Water Power Co

Bonds

it Carolina Power & Light Co. (10/20)
Sept. 17 filed $20,000,000 of first mortgage bonds due?

(Bids noon EST)

October

construction.

by competitive bid¬
ding.
Probable bidders: Halsey, Stuart & Co. Inc.; The
First Boston Corp.; Kuhn, Loeb & Co. and Union Secu¬
rities Corp. (jointly); Harriman Ripley & Co., Inc. Bids—
To be received by company at 11 a.m. (EDT) on Sept. 23.
Statement effective Sept. 16.

;

October 2,

Anheuser-Busch, Inc.

San Jose Water Works

• Associated
Telephone Co., Ltd. (Calif.)
(10/7)
Sept. 5 filed $10,000,000 of first mortgage bonds, series
H, due Oct. 1, 1982. Purpose—To repay bank loans and
for property additions and improvements. Underwriters
—To be determined by competitive bidding.
Probable
bidders: Halsey, Stuart & Co. Inc.; Paine, Webber, Jack¬
son
& Curtis, and Stone & Webster Securities Corp.
(jointly); White, Weld & Co. and Kidder, Peabody &
Co.
(jointly). Bids—Expected to be received about

(Dean

Debentures

Co., Inc.)

Witter

October

Co.)

6, 1952

(Stone & Webster Securities Corp., and Dean Witter & Co.)

October 7,

1952

Associated Telephone Co., Ltd..
(Bids

California

Electric Power

Bonds

Central

Common

Gulf

Sulphur Corp..—......—...^.--...Common
Morgan

(Peter

& Co.) r,

reduction of short-term notes payable.

Underwriters—
Goldman, Sachs & Co. and Merrill Lynch, Pierce, Fen¬
ner & Beane, both of New York. Temporarily postponed.

Bankers Fire & Marine Insurance Co.

(First Boston Corp.)

United Gas

Debentures

Corp.—^___——_i—
(Bids 11:30, a.ih. EST)

White's Auto Stores,

Aug. 25 (letter of notification) 24,000 shares of capital
stock (par $5) to be offered for subscription by stock¬
holders of record Aug. 20 at rate of two new shares for
each five shares held; rights to expire at 2 p.m. on Sept.
20. Fractional shares will not be issued. Price—$9 per
share. Proceeds
For additional working capital and"
surplus. Office — 321 North 23rd St., Birmingham, Ala.

—...—_—Common

Harnischfeger Corp.

•

;

Inc._____—_______JPrefenred

(Merrill Lyrtch, Pierce, Fenner ;& Beane)

1952?

October 14,

(Underwriters-—To

•

.*•

named)

06——

Utah Power & Light
*

—Bonds

(Bids noon EST)

■

•

Underwriter—None. '

October 15,

Beaver Dam Petroleum Corp. •
Sept. 12 (letter of notification) 4,000 shares of capital
stock.
Price—At par- ($10 per share).
Proceeds—To'
drill a well and for working capital. * Office—c/o Young,
Kaplan & Edelstem, 12 East 41st St., New York 17, N. Y.

Underwriter*—None.

Debentures

(Blair, Rollins & Co., Inc.)

(Bids

noon

offering

a new

Issue?Do.,

Get the facts from

of securities?

,«

i
.

■

your bdver-

a.m;

November 18, 1952

'
-

—Bonds

(Bids to be invited)

Pacific Telephone &
(Bids

(

Telegraph Co._—.Debentures
8:30 p.m.

P8T)

gives to the market tablet
the largest ctrcalafiengiven

December15,1952

CHICAGO TRIBUNE'

Chicago and

The Tribune

Class A & B

EST)

Long Island Lighting Co

In-

'■

page

vestment markets in

—Bonds
;

American President Lines, Ltd...
(Bids

Tribune advertising representa-

reach effectively and at

economical cost both-major

;

Hsing: counsel or nearest Chicogo

Through the Chicago Tribune,
you can

Continued

and the generalinvesting public,

you-want to publicize your services in the marketing

by competitive biddin&jL

Halsey, Stuart & Co. Inc.; Salomon
Bros. & Hutzler; Lehman Brothers; Kuhn, Loeb & Co.
and A. C. Allyn & Co., Inc.; The First Boston Cerp<*
Blyth & Co., Inc.; Equitable Securities Corp. Bidsr—XW
be received up to 11 a.m. (CDT) on Sept. 23. at com¬

Bonds

October 28, 1952

the midwest—professional buyer*

determined

Probable bidders:

1952

(Bids to be Invited)

2marftefc! I medium!

derwriter—To

EST)

October 21,

Are you

(9/23)

Aug. 18 filed $5,000,000 first mortgage bonds, series
due Sept. 1, 1982. Proceeds—For new construction. Un¬

Virginia Electric & Power Co...

•

1952

Carolina Power & Light Co.—
,j

;

}

pany's office.
October 20,

•

1952

Seiberling Rubber Co

(9/23)

Central Illinois Public Service Co.

California Oregon Power Co.—Bends & Common

—

Illinois Public Service Co.

Aug. 18 filed 50,000 shares of cumulative preferred stock
(par $100). Proceeds—For construction program. Under¬
writer—To be determined by competitive bidding. Prob—
able bidders: Blyth & Co., Inc. and The First Bostow
Corp. (jointly); Kidder, Peabody & Co. and Union .Se¬
curities Corp. (jointly); Lehman Brothers and Beaav
Stearns & Co. (jointly); Merrill Lynch, Pierce, Fenner 8*
Beane. Bids—To be received up to 11 a.m. (CDT) oaf1
Sept. 23 at company's office.

named)

Associates Investment Co.

Aug. 27 filed $30,000,000 of debentures due Sept. 1, 1962.
Price—To be supplied '• by amendment. Proceeds—For

Underwriters—

invited)

(Underwriter—to

construction.

competitive

* Central Eureka Mining Co., San Francisco, CalifL
Sept. 5 (letter of notification) 66,600 shares Of capital
stock (par $1). Price — Approximately $1.50 per share*
Proceeds—For new mining equipment and other corpo¬
rate purposes. Underwriter—Shaw, Hooker & Co., Saw
Francisco, Calif.
'

..Common

Sierra Pacific Power Co...

new

Pierce, Fenner & Beane (jointly); Equitable Securities
Corp.; Smith, Barney & Co. and Blyth & Co., Ine.
(jointly). Bids—Tentatively scheduled to be received^
up to noon (EST) on Oct. 20.

Preferred

...

determined

bidding. Probable*
Halsey, Stuart & Co. Inc.; Lehman Brothersj
W. C.
Langley & Co. and The First Boston Corps,
(jointly); Kidder, Peabody & Co. and Merrill Lynd%

...—.___

bidders:

1952

(Dillon, Read &

.Equip. Tr. Ctfs.

(EST)

(Bids noon

.1:,

\ J

Proceeds—For

1982.

1, 1952

Chesapeake & Ohio Ry._—

determined

employees and associates of New Superior; 270,000 shared
to be under option to officers and employees; and 240}—
000 shares to be under option to underwriters. Price—Aft
par.
Proceeds—To be added to general funds. Under¬
writer—Burnham & Co., New York.

Common

(Territory of Hawaii)

a.n».

Sept. 19); 400,000 shares have been sold to
latter named company and 400,000 shares to New Supe¬
rior Oils of Canada, Ltd.; 100,000 shares to be offered to
[EST]

September 39, 19S2

Appalachian Electric Power Co. (9/23)
Aug. 27 filed $17,000,000 of first mortgage bonds due
1982 and $6,000,000 of serial notes due 1956-1967.
Pro¬
repay

Corp. of record Aug. 27 (with rights to expire at 10

Debentures & Common

Southeastern Fund

Anheuser-Busch,

Underwriters—To

Co.)

Corp.

July 31 filed 3,410,000 shares of common stock (par 23
cents) of which 2,000,000 shares are being offered today
for subscription by stockholders of Palmer Stendel Oil

Common

September 26, 1952

equally between the parties

issued.

ceeds—To

Stanley

Co., San Francisco, Calif.

Canadian Palmer Stendel Oil

to stockholders—no underwriting)

(Morgan

certificates for such shares of stock to be

new

Common

Socony-Vacuum Oil Co., Inc...

and cause

Underwriter—Dean Witter &

September 25, 1952
Iowa Public Service Co

(jointly

Bids—Tentatively

California Water Service Co. (9/23-24)
Aug. 29 filed 80,000 shares of cumulative preferred stocks
series G (par $25). Price—To be supplied by amendments
Proceeds—To repay loans and for construction program.

Co., Inc.)

(Blyth & Co., Inc. and The First Boston Corp.)

to 11 a.m. (EST) on Oct. 28. If no bid is re¬
ceived which at least equals the minimum price of $14,000,000, the trustee will surrender and deliver the cer¬

Oct.

Pistell

determined

tween the United States of America and the Dollar in¬

tificates

Long Island Lighting Co

by competitive bidding. Bids—To
be received by The Riggs National Bank of Washington,
D. C., as trustee under a "Settlement Agreement" be¬

terests,

Debenture Notes

Allpark Finance Co., Inc

(10/7)
stock (par $IJL

common

To retire two convertible preference stock

Blyth & Co. Inc.; Lehman Brothers.
expected to be received on Oct. 7.

September 24, 1952

(Calif.) (10/28)
Sept. 4 filed 100,145 shares of class A stock (no par)
and 2,100,000 shares of class B stock (par $1). Proceeds
—One half to go to the Treasurer of the United States

—

Fenner & Beane and William R. Staats & Co.

Co. and M. S. Gerber, Inc., both of New York.

American President Lines, Ltd.

Power Co.

issues (5.50% and 5.60%) or for the discharge of bank
loans, or both. Underwriters—To be determined by com¬
petitive bidding. Probable bidders: Merrill Lynch, Pierce,

(Royal Securities Corp.)

Idaho Power Co..

Electric

Sept. 8 filed 350,000 shares of

CDT)

a.m.

Underwriter—

Francisco, Calif.

California

Central Illinois Public Service Co.

Portland, Ore.

phonograph records. Of¬

President. Underwriter—Walston, Hoffman & Goodwin^

EDT)

a.m.

California Water Service

Colorwall Tires," and blank pre¬

used to make

Calaveras Cement Co., San Francisco, Calif. \
Aug. 15 (letter of notification) 4,100 shares of common'
stock (par $1). Price—At market (estimated at $13 par
share). Proceeds—To Henry C. Maginn, Executive Vice-

(Offering to stockholders—no underwriting)

Appalachian Electric Power Co.

are

fice—55-01 43rd Street, Maspeth, N. Y.
H. B. Simon Co., New York.

Bonds

Pacific Telephone & Telegraph Co

"Lefferts

forms which

EDT)

a.m.

Pacific Power & Light Co
.

—Produces

.Bonds

Light Co.

quesne

REVISED

B Ian do Rubber
Corp.
Aug. 26 (letter of notification) 300,000 shares of commofl
stock (par 10 cents).
Price—$1 per share. Proceeds—
For expansion, equipment and working
capital. Business

Common

(Reynolds & Co.)

Aug. 28 filed $500,000 of 6%

ITEMS

Underwriter—Parsons & Co., Inc., Cleveland, O.

1952

General Bronze Corp

fective June 19.

19,

September

Bingham-Herbrand Corp.
Sept. 4 (letter of notification) 5,000 shares of comment
stock (par $1).
Price—At market (approximately $1#
per share).
Proceeds—To E. E. Parsons, Jr., a director*

NEW ISSUE CALENDAR

exchange offer will expire on Oct. 17. DealerManager—Dempsey & Co., Chicago, 111. Statement ef¬

•

held.

This
'

SINCE

III.

June 2 filed 41,669 shares of capital stock
offered in exchange for common stock of

(104$)

of leading stock exchange*
'them in America

New Orleans Public Service Inc.
(Bids to be invited)

* -Ai -;.'"

......Bonds

New York,

Boston

Philadelphia

Pittsburgh

San Francisco

Private Wires to all offices

Chicago^

Cleveland

;

Financial Chronicle

The Commercial and
42

John J. Rhodes and James E.

Continued

from

page

Thursday, September 18,1952

short-term loans and for property additions. Under¬
amendment. Blyth & Co., Inc.,
Lazard Freres & Co., both of New York, handled

pay

McNelis, officers and direc¬

writers—To be named by

companies.

tors of the two

and

6 (letter of notification) 300
stock (par $1). Price—$9 per share.

shares of common

Fuget, the selling stockholder.
Henke Co., Chicago, 111.

Proceeds—To Marie

Underwriter—Swift,

per

shares of common

Price—At market (about 30 cents
share). Proceeds—To H. E. Milliken, President. Un¬

stock

(par 10 cents).

derwriter

Securities Corp., New

Hunter

but

None,

—

York, will act

broker.

Syndicate Ltd. (N. Y.)
Sept. 11 (letter of notification) 200,000 shares of common stock (par 1 cent).
Price—$1 per share. Proceeds
—To purchase site, for purchase of inventories and for •
working capital.
Underwriter—Mortimer B. Burnside
& Co., Inc., New York.
Chemical

•

Ventures

Cincinnati

stock

mon

ceeds—For

(no par).
working capital.

Fair

Food

Aug. 28 (letter of nptification) 60,000

Inc.,

Stores,

July 25 filed $3,500,000 of 15-year sinking fund deben¬
tures due Aug. 1, 1967 and $2,500,000 of 10-year convert¬
ible junior debentures due Aug. 1, 1962. Price—To be
supplied by amendment. Proceeds—To pay notes issued
to the Portsmouth Steel Corp.
Underwriter — Halsey,
Stuart & Co. Inc., Chicago & New York. Offering—Ex¬
pected some time next month.
2.500 shares of common

Sept. 12 (letter of notification)

Philadelphia, Pa.

poses.

velop

plan.
Price—$3 below the average
price for the month in which payment is com¬
Proceeds—For general funds.
Underwriter—

stock

market

pleted.

purchase

General

•

May 14 filed $26,000,000 of interests in The Thrift Plan
for employees of this company, together with 400,000
shares of capital stock (par $5) purchasable under terms
of the plan.

International Technical Aero Services, Inc.

ington National Airport, Washington, D. C. Underwrite*
—James T. DeWitt & Co., Washington, D. C.

New

Co.,

Reynolds

shares,

Underwriters

—

•

$8.63

latter

Alden

Glen

per

may

receive

cash

they

which

rate

stock

Offer will expire

stock

public.

purchase building. Un¬
and Swift, Henke

Proceeds—To
Ellis

Simmons

Co., both of Chicago, 111.

•

Deerpark Packing Co., Port Jervis, N. Y.
(letter of notification) 235,000 shares of com¬
mon stock (par 10 cents).
Price—$1.25 per share. Pro¬
ceeds—To repay RFC loan of *41.050 and for working
capital. Offering—Expected before Oct. 15.
Devil Peak Uranium, Ltd. (Nev.)
April 7 (letter of notification) 6u0,000 shares of common
stock (par one cent).
Price—50 cents per share. Pro¬
ceeds— For rehabilitation and development program.
Office —Suite 839, 60 East 42nd St.,. New York 17, N..Y.
Underwriter—Gardner & Co., New York.

• Downtown Realty Co., Oakland, Calif.
Sept. 8 (letter of notification) 1,830 shares of capital
stock. Price
At par ($100 per share). Proceeds — To
erect parking garage.
Office—1419 Broadway, Oakland,
—

Calif.

Duquesne Light Co., Pittsburgh, Pa. (9/22)
Aug. 19 filed $14,000,000 of first mortgage bonds due
Sept. 1, 1982. Proceeds—To reduce bank loans (aggre¬
gating $15,810,000). Underwriters—To be determined by
competitive bidding. Probable bidders: Halsey, Stuart
& Co. Inc.; White, Weld & Co.; Drexel & Co. and Equit¬
able Securities Corp. (jointly); Kuhn, Loeb & Co., Union
Securities Corp. and A. C. Allyn & Co., Inc. (jointly);
Glore, Forgan & Co.; Harriman Ripley & Co. Inc. Bids—
To be received by the company at Room 1540, 15 Broad
up

to 11

a.m.

(EDT)

Sept. 22.

•

Electro-Components Corp. of America (9/23)
Aug. 19 (letter of notification) 2,000,000 shares of com¬
mon

stock

(par

cent).

one

•

Colorado Springs, Colo. ;
~
16,594 shares pf common"
(par $10), being offered for subscription by stock¬

Golden

Cycle Corp.,

Aug. 28 (letter of notification)
holders at rate of

Springs, Colo.

Underwriter—None.

Price—12

cents

per

and

Securities

working

Corp.,

capital.

share.

purchase

building.

Excelsior

common

($100 per share). Proceeds—To
Office—241 South Beverly Drive,

par

Beverly Hills, Calif.
•

Under¬

New York.

it Erie Commerce Building Corp.
Sept. 10 (letter of notification) 400 shares of
Price—At

Underwriter—None.

Insurance

Co.

of New York

Sept. 6

(letter of notification) 20,000 shares of capital
stock (par $6) being offered for subscription by stock¬
holders of record Sept. 8 at rate of one share for each
five

held

(with

oversubscription privilege);
rights to expire on Sept. 30. Price—$10 per share. Pro¬
ceeds—To increase capital and surplus.
Office—Syra¬
cuse, N. Y. Underwriter—None."
■ "*"
'
an

Family Finance, Inc., Indianapolis, Ind.
Sept. 9 (letter of notification) $150,000 of 5% subordin¬
ated notes to mature not more than five years from first
interest payment, date and 620 shares of 5% preferred
stock (par $100). Price—At par (the notes in denomina¬
tions of $500
small

loans

and $1,000 each).

business

and

Proceeds

purchase

— To
operate
conditional sales

contracts.

and The First Boston
.

working capital.
Underwriter—None, sales to be
certain officers and directors.

made through

Haloid

(par $50), being offered for subscription by common
stockholders at the rate of one preferred share for each
stock

held Sept.

10; with rights

* McGraw (F. H.) Co., Hartford, Conn.
Septi: 10.,-(letter of notification) 5,000 shares of common

(par $2) and warrants to purchase 20,000 shares
ccffnmqi^ stock at $6 per share to be offered in units |
of or e 'share and warrants to purchase four additional *
shares.; Price—$19.87V2 per share. Proceeds—To Clifford/

stock
of

St^ike|-the selling stockholder. Underwriter—Granf

bery|Marache & Co., New York.
Mmeral

Exploration Corp., Ltd., Toronto

July S9; filed 2,000,000
have

attached

it Harnischfeger Corp. (10/7)
Sept. 17 filed 150,000 shares of common stock (par $10).•
Price—To be supplied by amendment. Proceeds—To re¬

Canada

shares of common stock, each
"A," "B"

and "C"

warrant,.

ceeds—E-br exploration,

pay

part of bank loans and for general corporate pur¬

Underwriter—The First Boston Corp., New York.
Helio Aircraft Corp., Norwood, Mass.
'
July 21 (letter of notification) 3,000 shares of noncumulative preferred stock (par $1) and 3,000 shares
of common stock (par $1)
being offered initially to
stockholders of record July 25 in units consisting of one
share of preferred and one share of common stock. Price
—$25 per unit to subscribing stockholders and $27.50 per
unit to public. Proceeds — To continue development; of

poses.

aircraft

model

"Courier"

and

design

and

develop

aircraft. Office—Boston Metro¬
politan Airport, Norwood, Mass. Underwriters—Chace,
Whiteside, West & Winslow, and H. C. Wainwright &
Co., both of Boston, Mass.
"Helioplane"

type

Idaho Maryland Mines Corp.
6 filed

200,000 shares of common stock (par $1).
(on the San Francisco Stock Ex¬

market

change). Proceeds—To selling stockholder (Gwendolyn
MacBoyle Betchtold, as executrix of the last will and
testament
of Errol Bechtold, deceased).
Office—San
Francisco.

Calif.

Underwriter—None.

Sept. 3 filed 225,000 shares of common stock (par $20).

—At par.

Price—To be

Underwriter—B. V. Christie & Co.,

each

stock (par 35 cents), the class A stock to be sold
only to
policyholders of The Farm & Home Insurance Co. Price

Proceeds—To increase capital. Underwriters—

purposes.

Houston, Tex. Dealer Relations Representative—George
Sparight, 50 Broadway, New York, N. Y. Telephone
WHilehall 3-2181. Offering—Date indefinite.

Price—At par. Proceeds—To redeem
outstanding 8,500 shares of 4% cumulative preferred
stock (par $100) and for general corporate purposes.
Underwriter—The First Boston Corp., New York.
expire Sept. 29.

Price—At

Co.,
Phoenix, Ariz.
July 7 filed 1,613,168 shares of class A common stock
(par 25 cents) and 2,744,034 shares of class B common

common

(Glenn), Inc.

Co., Rochester, N. Y.

Aug. 14 filed 47,183 shares of convertible preferred stock

June

Farm & Home Loan & Discount

corporate
-

Gyrodyne Co. of America, Inc.
Sept. 16 (letter of notification) 12,300 shares of class A~
common stock
(par $1).- Price—$5 per share. Proceeds'

•

cent#; Price—$2 per share. Proceeds — For drilling of
exploratory wells, acquisition of leases and for general

I., N. Y. Underwriter—None. Of the amount offered,
$5,000 may be used as payment for services and for;
materials supplied.

—For

Co., Athens, Ohio
"7*»Aug. 8; (letter of notification) 2,500 shares of first pre¬
ferred stock, 5% series. Price—At par ($100 per share).
Proceeds—For working capital.
Underwriter—Roy E.
Hawk & Co., Athens, O.
McCarthy

apolis, Ind., will act

agent.

Office—Flowerfield, St. James,

Corp., both of New York.

McBee

June|I2 filed 10.000,000 snares of common stock (par25

Gyrodyne Co. of America, Inc.
■,
(letter of notification) 2,000 shares of class A
stock (par $1). Price—$5 per share.
Proceeds
working capital.

stock

subscription by common stock¬
in the ratio of one new share
for each seven shares held; rights to expire Oct. 9. Price
—To be supplied by amendment. Proceeds—To finance
construction program. Underwriters—Blyth & Co.; Inc.

common

—For

(9/24)

(no par) to be offered for

Sulphur Corp. (10/7-8)
Sept. 8 filed 225,000 shares of common stock (par 10
cents). Price—$3 per share. Proceeds—To pay costs of
drilling 25 test wells and for other corporate purposes.
Underwriter—Peter Morgan & Co., New York.

Office—612 Illinois Bldg., Indianapolis, Ind.
Underwriter—None, but City Securities Corp., Indian¬
as

Long Island Lighting Co.

Sept. 3 filed 599,942 additional shares of common

Gulf

stock.

Underwriter—None.

holders of record Sept. 24

it Goldwaters, Inc., Phoenix, Ariz.
*
Sept. 8 (letter of notification) 2,800 shares of 5% cumu¬
lative preferred stock and 200 shares of common stock.
Price—At par ($100 per share). Proceeds—To increase
operating capital. Office—31 N. 1st St., Phoenix, Ariz.

four shares of

equipment

writer—Royal

share for each 13 shares held *'

Underwriter—None.

and

new

July 31, 1952; rights to expire on Sept. 20. Price—
$16 per share. Proceeds—To make repayment of bank
loans.
Office — 500 Carlton Bldg., Box 86, Colorado.

Proceeds—To repay loan from Electronic Devices, Inc.,
for

one

it Lindberg Instrument Co., Berkeley, Calif.
Sept. 9 (letter of notification) $30,000 of 10-year promis¬
sory notes (in denominations of $1,000 each)
and six
shares of capital stock (par $10).
Price—At par. Pro-,1
ceeds—For working capital for development of product
"Fluid Sound." Office—1808 Harmon St., Berkeley, Calif.

Sept. 10

Underwriter—None.

St., New York 5,

the exchange.

March 21

deposited under plan.

stock, $100 per share; and for notes, at par. Pro¬
ceeds—For addition to plant. Underwriter.—None.
For

Georgeson & Co,, New York, will assist the company

Price—

subscription on a pro rata basis by stockholders.

7,172 shares of common
stock (par $25) to be offered for subscription by stock¬
holders; unsubscribed shares to be offered to public.
Price—$40 per share to stockholders and $41.75 per
derwriters—Blunt

Underwriter—None.

Sept. 9

(letter of notification)

it Lake Superior Refining Co., Superior, Wis.
Sept. 11 (letter of notification) 630 shares of common
stock and $63,000 of promissory notes to be offered for"

Bros,

exploration and development of oil properties. Office—
206 N. 7th St., Klamath Falls, Ore. Underwriter—None.

would

it Cook Electric Co., Chicago, III,

Under-,

it Klamath Oil, Inc., Klamath Falls, Ore.
Sept. 8 (letter of notification) 1,000 shares of common
stock. Price — At par ($100 per share;. Proceeds—For

Oct. 3. Members
NASD will receive 25 cents for each share of Burns
entitled.

become

property additions and improvements.

writer—None.

n;:&.

for

and

Aug. 26

holders

Proceeds—To pay off temporary bank loans

amendment.

Coal Co.

Glen Alden

(with an oversubscription privilege);^
rights to expire on Oct. 14.
Price—To be supplied by
eight shares held

Offering—To-iafi

York.

•

Sept. 25 at the rate of one new share for each

record

For 28,576

(Sept. 19).

tomorrow

(9/25)

Co.

Service

Public

Iowa

Aug. 29 filed 150,122 shares of common stock (par $5) to
be offered for subscription by common stockholders 'of

to be offered for

receivables.

cents). Price—$1 per share. Proceeds—For

working capital. Office—International Terminal, Wash¬

stock (par $5),
subscription
by common stockholders at rate of one share for each
10 shares held Sept. 18 (rights to expire on or about
Oct. 6); 10,000 shares are to
offered to the trustees
of the company's Employees' Profit Sharing Plan and
Trust; and 5,000 shares to directors and officers of the
company and its subsidiaries. Price—To stockholders $14
per share. Proceeds—For working capital and to finarfce
and

(letter of notification) 300,000 shares of common

stock (par 10

Aug. 28 filed 43,576 shares of common

Underwriter—None.

general corporate pur¬

device.

Feb. 15

(letter of notification) 13,232 shares of capital
stock
(no par) being offered in exchange share-forshare for common stock of Burns Bros. As an alternative

brokers.

and for

Business—To provide research facilities an^ de¬
products capable of being produced in South

a wet-cell battery proi.ec->
Office—4016 N.W. 29th Street, Miami, Fla.
Underwriter—Barham & Cleveland, Coral Gables, Fla.' j

tive

(9/19)

Bronze Corp.

Underwriter—None, but Fahnestock & Co., New York,
as

Fla.

Florida, the first of which is

it Front Range Mines, Inc., Denver, Colo.
Sept. 8 (letter of notification) 125,000 shares of common
stock (par $1).
Price—At market (approximately 37%
cents per share). Proceeds—To Irene F. Marple, a direc¬
tor. Underwriter—Stanley Pelz & Co., Inc., New York.

made

Continental Oil Co., Houston, Tax.

Miami,

Inc.,

None.

stock (par $20). Price—At market (about $35 per share).
Proceeds—To Joseph P. Routh, the selling stockholder.
will act

Research,

working capital

crease

100,000 shares of common stock (par $1)
be offered to certain employees pursuant to the terms

inventories

Clinchfield Coal Corp.

Industrial

Aug. 27 (letter of notification) 200,000 shares of common
stock.
Price—At par ($1 per share).
Proceeds—To in¬

Underwriter—None.

filed

of which 28,576 shares are

Enquirer, Inc.

previous equity financing.

about 833 shares of com¬
Price—About $12 per share. Pro¬

Sept. 9 (letter of notification)

Sept.

Century Natural Gas & Oil Corp,

Hatboro, Pa.

Porter Co.,

Fischer &

Muskegon, Mich.

Central Paper Co.,

Aug.

...

(1050)

Idaho

Power Co.,

Boise,

Ida.

(9/23)

supplied by amendment.

Proceeds—To re¬

giving the holder the right to buy one additional
share for each two shares purchased in two, three, or

five years, at $1, $2 and
—For 2,000,000 shares,

$3 per share, respectively. Price
$1

per

Pro¬

share—Canadian.

development and acquisition of
properties. Underwriter—Brewis & White, Ltd., Toronto,
Canada. Names of United States underwriters to be sup¬
plied by amendment.

Salt Lake City, Utah
Sept. 8 (letter of notification) 150,000 shares of common
it Multiple Dome Oil Co.,
stock.

market

Price—At

(approximately

cents per

share). Proceeds—To George W. Snyder, President.
derwriter—Greenfield & Co., Inc., New York.

Un¬

* National Discount Corp., Spartanburg, S. C.
;
Sept. 8 (letter of notification) 200,000 shares of class A
common
stock and 100,000 shares of class B common
stock,

Price—$1

per

share.

Proceeds—For organization¬

and working capital. Office—410
Spartanburg, S. C. Underwriter—None.

al expenses

National

Tank

E. Main St.,
-

Co., Tulsa, Okla.

Aug. 27 (letter of notification) 4,000 shares of common
stock
(par $1).
Price—At the market (estimated at
about $24 per share).
Proceeds — To Jay P. Walker,
President, the selling stockholder. Address — Drawer
1710, Tulsa, Okla.
Underwriter—None.
Nevada Mortgage

Aug. 25

& Investment Co.

(letter of notification) 60,000

shares of common

$1) and 240,000 shares of preferred stock (par
$1) to be offered in units of four shares of preferred
stock and one share of common stock. Price—$5 per unit
stock (par

Proceeds—For costs incident to organization and devel¬
opment of business in purchasing and making first and

Number 5152

Volume 176

Signal Mines, Ltd., Toronto, Canada
July 14 filed 300,000 shares of common stock. Price—
At par ($1 per share). Proceeds—For exploration, devel¬
opment, and mining expenses, and to reimburse Maurice
Schack, Secretary-Treasurer. Business—Quartzite min¬
ing. Underwriter — Northeastern Securities Co., New

exercise an option cover¬
Office—114 North Third St.,
Underwriter — Stone & Youngberg,

loans; and to

second mortgage

ing sale of income property.
Las

Vegas, Nev.
San Francisco, Calif.

Inc., St. Louis, Mo.

Ozark Air Lines,

(1051)

The Commercial and Financial Chronicle

Sept. 3 (letter of notification) 149,562

shares of common

York.

(par $1) to be offered for subscription by stock¬
holders. Price—$1.50 per share to stockholders; $1.75 to

stock

•

Silver Bell Mines Co., Denver,

Colo.

public.

Aug. 29 (letter of notification) 95,682 shares

tal.

stock

Proceeds—For new equipment and working capi¬
Address—P. O. Box 6, Lambert Field, St. Louis 21,
Underwriter—Newhard, Cook & Co., St. Louis, Mo.

Mo.

each 19 shares held;

Portland, Ore. (9/22),
Aug. 22 filed $7,500,000 of first mortgage bonds, due
Sept. 1, 1982. Proceeds—For improvements and additions
to property.
Underwriters—To be determined by com¬
petitive bidding. Probable bidders: Halsey, Stuart & Co.,
Inc.; Bear, Stearns & Co., and Salomon Bros. & Hutzler
(jointly); Kidder, Peabody & Co.; Blyth & Co., Inc.;
Union Securities Corp.
Bids—To be received at noon
(EDT) on Sept. 22 at Two Rector St., New York, N. Y.
Pacific Power & Light Co.,

—$2.25

rights to expire on Sept. 30. Price
Proceeds—For increased production
Office—434 U. S. National Bank Building, Den¬

at mine.
ver,

share.

per

Colo.

Underwriter—None.

Proceeds—For the

acquisition and develop¬
ment of crude oil production, and the expansion and
improvement of refining, transportation and marketing
facilities.
Underwriter—Morgan Stanley & Co., New

Pacific Western Oil Corp.

100,000 shares of common stock (par $4).
Price—At the market. Proceeds—To J. Paul Getty, Presi¬

Aug. 5 filed
dent,

None, sales to be
the New York Stock Exchange.

Underwriter

brokers

—

Paradise Valley

handled

York.

Oil Co., Reno, Nev.

Aug. 20 filed 3,000,000 shares of capital stock. Price—|
At par (10 cents per share). Proceeds—To drill six wells
on subleased land and for other corporate purposes. Un¬

derwriter—None, with sales to be made on a commission
basis (selling commission is two cents per share).
Of¬
fice—c/o Nevada Agency & Trust Co., Inc., Cheney Bldg.,
N.

139

Virginia St., Reno, Nev.

Phillips Packing Co., Inc., Cambridge, Md.
July 7 (letter of notification) 3,000 shares of common
stock (no par). Price—At the market (estimated a $7 per
share). Proceeds—To Levi B. Phillips, Jr., Vice-Presi¬
dent, the selling stockholder. Underwriter—Alex. Brown
& Sons, Baltimore, Md.
,

Pure Oil

•

•■

Co., Chicago^ III.

filed 85,688 shares of common stock (no par)
being offered in exchange for 471,287 shares of HickOk
Oil Corp., class A common stock (par $1) at rate of one
Pure Oil share for each 5V2 Hickok shares, conditioned

July

approval

upon

Products

Co.,

of merger of
wholly-owned

Co. Underwriter—None,
Safewav

Hickok into Pure
subsidiary of Pure
*

Oil
Oil

assets of

will

all

sell

Dick Company
a substantial part of these shares from
the New York Stock Exchange. Under¬

It is anticipated that the

writer—None.
•

San Jose,

Calif.

(10/2)

41,000 shares of cumulative convertible
preferred stock, series C (par $25). Price—To be supplied
by amendment. Proceeds—To pay off bank loans and for
construction. Underwriter — Dean Witter & Co., San
filed

Francisco, Cal.
Scott

Paper Co.

expire

Sept.

23. Price—At Par. Proceeds—For
mill at Everett, Wash., and other

-construction of paper

and for working capital. Underwriters—
Co., Philadelphia, Pa.; and Smith, Barney &

construction,
Drexel

"Co/ and
of

New

Merrill Lynch,
York

Pierce, Fenner & Beane, both

City.

if Seacrest Productions, Inc., Newport, R. I.
Sept. 8 (letter of notification) 5,000 shares of non-voting
common stock, series B
(no par). Price—$10 per share.
Proceeds—To acquire real estate and buildings, convert
sound stages, install recording equipment and cameras,
and for other corporate purposes. Office—73 Bliss Road,
Newport, R. I„ Underwriter — Kidder, Peabody & Co.,
New York.

Security Title & Guaranty Co., N. Y.
Aug. 22 (letter of notification) 32,000 shares of common
stock (par $1).
Price—At market (about $2 per share).
Proceeds—To Investors Funding Corp. of New York.
Underwriter—Dansker Brothers & Co., Inc., New York.

Security Title Insurance Co., Los Angeles, Calif.
(letter of notification) 7,000 shares of common
(par 50 cents), of which 1,769 shares will be

Sept. 2
stock

.offered

employees and persons otherwise associated
and 5,231 shares will be offered to the

with the company

general public.
Price—To public, $5.75 per share and
"to employees, $5.50 per share.
Proceeds—To William
S. Porter,

Chairman of the Board.

Underwriter—Lester,

Ryons & Co., Los Angeles, Calif.

^-Sierra Pacific Power Co. (10/6)
.Sept. 15 filed 26,775 shares of common stock (par $15)
to be offered for subscription by holders of preferred
and common stocks on the basis of one share for each
'six shares of preferred and one share for each 12 shares
of common stock. Price—To be supplied by amendment.
Proceeds—From sale of stock, plus proceeds from private
sale of $1,500,000
to

used

construction.

contracts.

sales

Herrick

Underwriter—Barrett

Co., Inc., New York.

•

Specialty Converters, Inc., East Braintree, Mass.
(letter of notification) 5,000 shares of common
stock (par one cent).
Price—At market (estimated at
67V2 cents).
Proceeds—To Leif B. Norstrand, President.

Aug. 27

•

Standard

Otis, Inc., New York.

Letter

Oil

Co.

(Indiana)

filed

$139,647,200 of 30-year 3V8% debentures
due Oct. 1, 1982 (convertible on or before Oct. 1,#1962),
being offered for subscription by holders of capital stock
at the rate of $100 of debentures for each 11 shares of
stock held as of Sept. 17; rights to expire about Oct. 6.
Price—100%.
Proceeds—To retire $50,000,000 of 1%%

Aug.

loans

bank

payable

Oil

will

$25,000,000 of 1.75% notes of
Gas Co., a wholly-owned subsidiary,

company,

and $6,500,000 of 2.75% notes of
Corp., a
subsidiary
substantially

banks;

Southern

Pan-Am
owned

by Standard, payable to banks. Any remainder
used for capital expenditures.
Underwriter—

Morgan Stanley

& Co.,

New York.

Exploration Co., Los Angeles, Calif.
Aug. 6 (letter of notification) 43,000 shares of capital
stock (par $1) being offered for subscription by stock¬
holders of record Aug. 20 at rate of one share for each

first mortgage bonds in October, 1952,
$1,100,000 bank loans and for new

repay

Underwriter—Stone &

Webster Securities

Corp., New York, and Dean Witter & Co., San Francisco,
Calif.

10 shares

share.

held; rights to expire on Sept. 19. Price—$5 per
—
For expansion program and general

Proceeds

Office—649 S. Olive St., Los An¬
geles, Calif. Underwriter — None. Unsubscribed shares
will be sold to "small group of individuals."
corporate

Steak

purposes.

Shake of Illinois,

Inc.

one sh^re for every
20 shares held, with an oversub¬
scription privilege; rights to expire on Sept. 15. Price—
$3.30 per share. Proceeds—For expansion. Office—1700
W. Washington St., Bloomington, 111. Underwriter—None.

Storer

Exchange at time of offering. Proceeds—For working
capital. Underwriter—F. W. MacDonald & Co., Inc., New
York.
Offering—Probably not before the end of Sep¬
General Production Co.-

Texas

filed 2,500,000

June

shares of common stock (par 50

Price—To be supplied by amendment. Proceeds—

cents).

buy property for oil prospecting.
Office—Houston,
Underwriter—To be named by amendment (prob¬

Tex.

Offering—

New York).

Co.

Noyes

Hemphill,

ably

Tentatively postponed.

Houston, Texas

Texhead Royalty Co.,

July 17 (letter of notification) $135,000 of 3% income
notes, due July, 1962, and 30,000 shares of common stock

(par 10 cents) to be offered in units consisting of $9
principal amount of notes and two shares of common
stock of this company, together with one $9 note and
two common shares of the Wilhead Royalty Co.
Price

Proceeds—For acquisition of oil and gas

—$20 per unit.

royalties in the southwest.
Office — 415 San Jacinto
Bldg., Houston^, Texas. Underwriter—Rotan, Mosle &
Moreland, Hofiston, Tex. (See also Wilhead Royalty Co.
below.)
Texo

Oil Corp.,

Ardmore, Okla.

Sept. 2 (letter of notification) 934,400 shares of common
stock (par one cent). Price—31
cents per share. Pro¬
ceeds—To drill three wells to test formation on corpora¬
tion's leases in Duval and Live Oak Counties, Texas.
Underwriter—Stanley Pelz & Co., Inc., New York.

Pikesville, Md.
notification) $116,150 of 5% con¬
issue, due Sept. 1, 1962. Price
—At par (in units of $50 each).
Proceeds—For working
capital. Address—P. O. Box 356, Pikesville, Md. Under¬
Thompson Trailer Corp.,

(letter

Aug.

writer—None.
Torhio Oil Corp.,

Broadcasting Co.

May 19 filed 2l§,00t shares of common stock (par $1),
of which 200,000 shares are being sold by certain selling

offered publicly and 10,000 to
20,000 shares to the underwriters
under option agreement) and the remaining 15,000 shares
being reserved for sale by company to certain employees.
Price—Of first 200,000 shares, to be supplied by amend¬

Ltd., Toronto, Canada

Aug. 21 filed 300,000 shares of common stock (par $1) to
be offered first to stockholders and then to the general

public. Price — 60 cents per share. Proceeds—For ex¬
ploration of oil and gas properties, and to drill a test
well. Underwriter—None, but offering to public will be
handled through brokers.
United Gas Corp.,

(10/7)

Shreveport, La.

5 filed $60,000,000 sinking fund debentures due
Proceeds—To repay bank loans and for construc¬

Sept.
1972.

tion program.

Underwriters—To be determined by com¬

petitive bidding.
Probable bidders: Halsey, Stuart &
Co. Inc.; The First Boston Corp., Harriman Ripley &
Co., Inc. and Goldman, Sachs & Co. (jointly); Morgan
Stanley & Co., White, Weld & Co. and Equitable Secu¬
rities Corp.
(jointly).
Bids—Tentatively expected to
be received &t 11:30 a.m. (EST) on Oct. 7.
if United Hardware & Furniture
Minneapolis, Minn.

Distributing Co.,

notification) 1,650 shares of 5% cumu¬
preferred stock (par $100), of which 506 shares
offered' for the account of a selling stockholder;

Sept. 12 (letter of
lative

to be

are

and 2,100

shares of common stock (par $10).

Price—At

for preferred; and at $50 per share for common.
Proceeds — For working capital. Office — 2432 North
par

Second St.,

Minneapolis 11, Minn. Underwriter—None.

U. S. Airlines,

July 11 (letter of notification) 22,000 shares of common
stock (par 50 cents) being offered to stockholders of
record July 1 (excepting members of the Belt family,
who own about 60% of the common stock) at rate of

Toronto, Canada

Sweet Grass Oils, Ltd.,

July 29 filed 375,000 shares of common stock ((no par).
Price—To be related to quotation on the Toronto Stock

vertible debentures, first

State

Aug. 15 filed $24,952,800 of convertible debentures due
Sept. 1, 1977, being offered for subscription by common
stockholders of record Sept. 8 on basis of $100 of de¬
bentures for each 12 shares of common stock held; rights
to

ditional

Stanolind

Jose Water Works,

San

Sept.

—

1,900 shares of 4%

Dick.

time to time

Fund, Columbia, S. C. (9/26-30)
Aug. 14 filed $500,000 of 10-year 6% subordinated sink¬
ing fund debentures (with common stock purchase war¬
rants attached) and 100,000 shares of common stock (par
$1) to be offered in units of a $100 debenture and 20
shares of stock. Price—To be supplied by amendment.
Proceeds
To redeem $53,500 outstanding 5%% sub¬
ordinated convertible debentures and 10,000 shares of
6y2% cumulative preferred stock (at $11 per share and
accrued dividends), and for additional working capital.
Business—Financing retail sales of house trailers on con¬

subsequently withdrawn.

Inc.

Stores,

filed

Southeastern

Underwriter—Gearhart

cumulative preferred
stcok (par $100) and 18,000 shares of common stock (par
$5) to be issued to James A. Dick Investment Co. (for¬
merly The James A. Dick Co.) in exchange for inven¬
tories, fixtures, operating supplies, good will and other
Sept.

if South Texas Oil & Gas Co., Corpus Christi, Tex.
Sept. 2 (letter of notification) 748,000 shares of common
stock (par 10 cents). Price—40 cents per share. Proceeds
—For drilling expenses, acquisition of leases, etc.
Un¬
derwriter—Hunter Securities Corp., New York.
•

debentures due

(subordinate) and 450,000 shares of common stock
(par 50 cents) of which the debentures and 400,000 shares
of stock are to be offered in units of $50 of debentures
and 20 shares of stock. Price—$100 per unit. Proceeds—
To increase capacity of plant and for working capital.
Underwriter—Weber-Millican Co., New York. Offering
—Expected some time this month.
,
1972

tember.

Socony-Vacuum Oil Co., Inc. (9/25)
Sept. 5 filed 3,180,188 shares of capital stock (par $15)
to be offered for subscription by stockholders of record
Sept. 25 at rate of one new share for each 10 shares held;
rights to expire on Oct. 14.- Price—To be supplied by
amendment.

of Pennsylvania

Sunshine Packing Corp.

July 3 filed $1,000,000 of 6% convertible

of common

to be offered for subscription by stock¬
the rate of one new share for

(par $1)

holders of record Sept. 3 at

Inc., Fort Lauderdale, Fla.

(letter of notification) $210,000 of 7% convert¬
ible equipment trust certificates, series A, due Aug. 15,
1954. Price—At par (in units of $100 and $1,000 each).
Proceeds—For purchase of two aircraft. UnderwritersJohn R. Kaufmann Co., Scherck, Richter Co. and Semple,
Jacobs & Co., Inc., all of St. Louis, Mo.; and Gearhart
& Otis, Inc., New York.
Aug. 4

Power &

Utah

Light Co.

(no par),
of record
Sept. 5 on a one-for-10 basis (with an oversubscription
privilege); rights to expire Sept. 25.
Price—$28.75 per

Aug. 14 filed 167,500 shares of common stock
being offered for subscription by stockholders

stockholders (170,000 to be

share.

certain employees; and

—None.

ment; of 15,000 shares by company, $10,621/2 per share.
Proceeds—For general corporate purposes.
Underwrit¬
ers—Reynolds & Co., New York, and Oscar E.
Co., Miami, Fla.

Dooly &

Statement being withdrawn.*

III.
Aug. 27 (letter of notification) 2,367 shares of common
stock (par $50) to be offered for subscription by common
stockholders at rate of one new share for each four
shares held.
Price—$100 per share.
Proceeds—To in¬
crease equity capital to take care of increased business
Streeter-Amet

and increased

costs.

Chicago 13, 111.
Suburban

Co., Chicago,

Office—4101 Ravenswood Avenue,

Underwriter—None.

Propane Gas Corp.

Sept. 8 (letter of notification) approximately 4,440 shares
of common stock (par $1). Price—At market ^estimated
per share).
Proceeds—To SBN Gas Co., the
selling stockholder. Underwriter—None, but sales may
be made through Eastman, Dillon & Co., New York,
and/or Bioren & Co.. Philadelphia, Pa.

at$17.87y2

Proceeds—For

Utah

Aug.
1982.

Power &

Underwriter

construction.

Light Co.

(10/14)

14 filed $10,000,000 of first mortgage bonds due
Proceeds—To repay bank loans and for new con¬

bidding.

Probable

bidders: Halsey,

Inc.; White, Weld & Co.;
Stearns

competi¬
Stuart & Co.

Underwriters—To be determined by

struction.
tive

new

Co.

(jointly);

Lehman Brothers and BearFirst Boston Corp. and

The

Securities Corp. and
Peabody & Co.;
Bids—Tentatively scheduled

Blyth & Co., Inc. (jointly); Union

Smith, Barney & Co. (jointly); Kidder,
Salomon

Bros.

& Hutzler.

to be received up to noon

(EST) on Oct. 14.

^Virginia Electric & Power Co. (10/21)
Sept. 17 filed $20,000,000 of first and refunding mort¬
gage bonds, series J, due Oct. 1,
1982. Proceeds—For
construction program. Underwriters—To be determined
by competitive bidding. Probable bidders; Halsey, Stuart
& Co. Inc.; Kuhn, Loeb & Co. and Wertheim & Co.
(jointly); Stone & Webster Securities Corp.; Union
Securities Corp.; Salomon Bros. & Hutzler; White, Weld
& Co.
Bids—Tentatively scheduled to be received on
Cct. 21.

Continued,

page

The Commercial and Financial Chronicle

(1052)

Continued

from

Central Maine

page

Sept. 2 it

Washington Water Power Co. (9/30)
Aug. 27 filed $30,000,000 of first mortgage bonds due
Oct. 1, 1982.
Proceeds—To repay part of outstanding
f)ank loans. Underwriters—To be determined by com¬

Westinghouse Electric Corp.
Aug. 27 filed 150,000 shares of common stock (par $12.50)
Co be offered under "employees stock plan" to employees
of corporation and six subsidiaries. Proceeds—For gen-

Chesapeake & Ohio Ry.

oral corporate purposes.

Co.r Houston, Texas
(letter of notification) $135,000 of 3% income
July, 1962, and 30,000 shares of common stock
{par 10 cents) to be offered in units consisting of $9
principal amount of notes and two shares of common
July 17

clusive.

Probable

Salomon Bros.

Bldg., Houston 2, Texas.
Underwriter—Rotan,
Moreland, Houston, Tex. (See also Texhead
Royalty Co. above.)

basis.

equipment, for research and development and for work¬
ing capital. Underwriter—Graham, Ross & Co., Inc., New

—Putnam &

ceeds—For working capital.

Aug.

ond

the

issue

before

all

further shares will be offered). Proceeds
tin placer leases, exploration and

Ames &

Underwriter—

Power Co.

announced that it is

presently estimated
$11,000,000 of additional capital will
the latter half of 1952. Underwriter

applied

company

10 it

ber.
Maine Central

common

stock of Duquesne Light Co.
Underwriters—
be determined by competitive bidding. Probable
bidders: Blyth & Co., Inc. and Merrill Lynch, Pierce,

sold, no
For Alaska

Fenner & Beane

(jointly); Kuhn, Loeb & Co. and Smith,
Barney & Co. (jointly); The First Boston Corp.
Eastern

Utilities

cient

of common stock to raise approximately
plan further provides that Blackstone Valley
Gas & Electric Co., Brockton Edison Co., and Fall River
Electric Light Co. issue mortgage bonds. Proceeds—To
repay bank loans.
Underwriters—For EUA debentures
may be determined by competitive bidding.
Probable
amount

$2,000,000.

Arkansas Power & Light Co.
Aug. 7 C. Hamilton Moses, President, announced that

bidders:

the company expects to borrow additional
money next

Spring to finance its 1953 construction program, which,
estimated, will involve $29,500,000.
-

riman Ripley & Co., Inc.

fering—Expected

•

some

(jointly).

/ '

;

HechtXo.':'/.•'.V.
Aug. 20 it
18

& Co., New York. Of¬

* *

debt provided the com¬
raises at least $3,500,000 of additional junior equity
capital. Junior stock financing is now under considera¬

Byrd Oil Corp., Dallas, Tex.
July 22 it was announced stockholders will in the fall
ateceive the right to subscribe for
$1,700,000 of 5M>% first
mortgage (convertible) bonds on a pro rata basis for a
14-day
standby
(certain
stockholders
have
waived
Uieir rights). Proceeds—To
repay bank loans and for

pany

development and exploration

tunnel and flood control bonds to be dated Oct.

expenses. Underwriters—
Probably Dallas Rupe & Son, Dallas,
Tex.; Carl M.
JLoeb, Rhoades & Co., New York; and
Straus, Blosser &
McDowell, Chicago, 111,
•

California Oregon Power Co.

tion. Underwriter—Goldman, Sachs & Co., New York.

Ar Honolulu (Territory of Hawaii)
Sept. 11 it

was

;

issue of $6,600,000 school,
1, 1952
and to mature annually Oct. 1, 1953 to 1982, inclusive,
with a coupon rate not to exceed 5%. Probable bidders
may include Halsey, Stuart & Co.; The First Boston

~ ~

w.as

^n^KS^riS °f

recently applied to
U. Commission for
authority to issue
0 of first mortgage bonds due 1982 and

comin,on stock <Par $2°)- Proceeds—To
<J?ns and for construction program. Under?°r Sock' Probably Blyth & Co., Inc., and
For bonds' to be determined
competitive K-^?rp*

Dec.

31, 1952, up to 21,000 additional shares of 4% cumu¬
lative preferred stock at 100 and accrued dividends.

bv
by

bidding. Probable bidders: Halsey, Stuart

JwCiJr

r*111
f°l

o?rney & Co"' Umon Securities Corp.
'

phoades & Co* (jointly);

ter'f toidivV^H-°^01V

Blyth & Co.,

and Sak)mon Bros. & Hutz-.

Development

("World Bank")
^ :
Sept. 3 it was announced Bank plans to issue and sell
between $50,000,000 of $75,000,000 irr United States dol¬
lar bonds

this

Fall.

Underwriters

—

The First

Boston

Corp. and Morgan Stanley & Co., both of New York.

Ar Kaiser-Frazer Corp.
»•

Hu<,,on «»• *

SXfS?

«——«»

*ss5:

Elactrle Corp.

»v.4«Vl!S:

Sept. 9 it

reported that company may come to mar¬
an issue of common stock, or convertible
preferred stock or debentures, to yield between $25,000,ket

soon

was

reported company plans to issue and
an

issue of

$8,000,000 first mortgage

Underwriters—To be determined by competitive

bonds.

Probably bidders: Halsey, Stuart & Co. Inc.;
White, Weld & Co. and Kidder, Peabody & Co. (jointly);
Blyth & Co., Inc.; The First Boston Corp. and W. C.
Langley & Co. (jointly); Equitable Securities Corp. and
Shields & Co. (jointly); Merrill Lynch, Pierce, Fenner
& Beane; Union Securities Corp.
National Credit

Card, Inc. it was reported company is considering doing
some equity financing (probably in the form of class B
stock of $20 par value).
/ i

Sept.

New Orleans Public Service Inc.

was

with

OOQ and $30,000,000. Proceeds—-To repay bank loans, now
amounting to $22,000,000. Financial Adviser—The First
Boston Corp.,! will handle the financing, with Henry J.
Kaiser Co. purchasing a major part or all of the issue,
whichever it may be.

(12/15)

July 24 company announced plans to issue and sell $6,«
000,000 of first mortgage bonds due Dec. 1, 1982. Pro¬
ceeds—For new construction. Underwriters—To be de¬
termined

Halsey,

by competitive *■ bidding.
Probable bidders:
Stuart & Co. Inc.; Lehman Brothers; Kidder,

Peabody & Co. and Stone & Webster Securities Corp.
(jointly) ; Equitable Securities Corp.; Union Securities
Corp. Registration — Expected about Nov. 14. Bids
Tentatively set for Dec. 15.

•

Ar Oklahoma Metropolitan Oil ;& Gas Corp.
■».,,
Sept. 10 it was announced that company plans some addi¬
tional

common

weeks/

stock

Proceeds—For

and

financing

in about three

acquisition of properties,

drilling

expenses,

etc.

Pacific Northwest Pipeline

four

work¬

Underwriter-

Scott, Khoetry, Brockman 8t Co.. Ine.. New York.

Corp.

Aug. 29 company filed a second substitute application
with the FPC proposing to construct a 1,384-mile trans
mission line extending from the San Juan Basin in Ne
and

Mexico
is

Colorado to market areas in the, Pacifi
Estimated overall capital cost of the proj

$179,000,000.

Financing is expected to consist of fi

pipeline bonds, and preferred and coram
stocks, and is expected to be completed by April, 195
Underwriters—White, Weld & Co. and Kidder, Peabo
& Co., both of New York, and Dominion Securities Corp
Ltd., Toronto, Canada.^ ( :

mortgage

Telegraph Co.

(9/22)

Sept. 3 company was authorized by the California P. U.
offer for subscription ,by stockholders
an

additional

in the

ratio

common

International. Bank for Reconstruction and
,

in November

Pacific Telephone &

Idaho Power Cd.v '•;* '
^
Aug. 19 it was reported company has granted an option
to Wegener & Daly Corp., Boise, Ida., to purchase until

£ta^d company had

sell

•

fiie California P

Mississippi Power & Light Co.
March

Northwest.

(9/30)

announced that bids will be received

Sept. 30 for the purchase of

Corp,

(10/14)'

reported company has asked the FPC
authority to start work on a $7,000,000 expansion pro¬
gram. An early decision is expected.

for

ing capital

announced stockholders will vote Sept.
approving certain amendments which would per-1,
was

mit somewhat more-long-term

time prior to end of 1952.

Gas Co.

was

only);

Ar Oulf Interstate Gas Co., Houston, Tex.
.Sept. 16 company applied to the FPC for authority to
build an 860-mile pipe line from Louisiana to Kentucky,
which, it is estimated, will cost about $121,887,000.

share for each 10 shares

for debentures: Morgan Stanley

(for bonds

tional $400,000

iield, also proposed issue and sale of $3,000,000 of de¬
bentures. Underwrtters—For stock:
none, with Tobacco
3c Allied Stocks, Inc.
(owner of over 50% of present out¬
standing, common stock) to buy any unsubscribed shares.
,

Inc.

June 11 it
will vote

Ar Benson & Hedges
Sept. 10, Joseph F. Cullman, Jr., President, announced
proposed offering of common stock for
subscription to
one new

Co.

European American Airlines, Inc.
was reported company plans to raise an addi¬
of equity capital. An issue of $200,000
of capital stock was Just recently placed
privately at
$7.50 per share. Underwriter — Gearhart, Kinnard Ar
Otis, Inc., New York, r

Sept.
30 on increasing authorized indebtedness
by issuance of
$14,000,000 notes.

stockholders at rate of

Lehman Brothers; Estabrook & Co. and Stone & Webster
Securities Corp. (jointly); Glore, Forgan & Co. and Har¬

at is

announced stockholders

Halsey, Stuart

South

Aug. 23 it

bidding.

Associates

Sept. 3 it was announced that amended plant of reor¬
ganization of this company and subsidiaries calls for is¬
suance by company of $7,000,000 debentures and a suffi¬

Franklin & Co. of Los Angeles, Calif.

RR.

sought ICC permission for authority toissue and sell $1,500,000 of divisional lien bonds withoutcompetitive bidding. Proceeds — Together with other
funds, will be used to retire the outstanding $1,676,000
Portland & Ogdensburg Ry. first mortgage 4J/2% bonds
which mature Nov. 1, 1953.
company

Mid

reported

common

debt, and working capital. Office—30 Exchange
Place, Salt Lake City 1, Utah. Underwriter—Samuel B.

was

Sept. 2

May

ment of

Semis Bro. Bag Co,

by competitive bidding. Probable bidders: Halsey, Stuart
& Co. Inc.; W. C. Langley & Co.; Smith, Barney & Co.;;
Blyth & Co., Inc. and The First Boston Corp. (jointly)-

Inc. (9/30)
to the Interstate Commerce

that Philadelphia Co. is con¬
sidering plans to sell publicly about 200,000 shares of
was

Co., Grand Rapids, Mich.

Offering—Tentatively scheduled for sometime in Novem¬

Co., Hartford, Conn.

largest motor

Sept.

development, retire¬

Aug. 13 it

Inc.

Long Island Lighting Co. (11/18)
Aug. 27 company announced its plan to issue and sell
$20,000,000 additional mortgage bonds. Proceeds—For
construction program. Underwriters—To be determined

Ar Duquesne Light Co.

are
—

Refineries,

Proceeds—Together with funds from private sale
$1,500,000 7-year serial notes, to be used toward ex¬
pansion program. Underwriter — Probably Bradbury-

the United States.

Price—$110 per unit. Pro¬
Underwriter—None.

value.
(Current quotation of the company's
-stock on the Los Angeles Stock
Exchange is seven cents
fcid and nine cents
offered, if $120,000 gross sales price is

Inc.;

carrier of general freight in
Underwriters—Blyth & Co., Inc., San
Francisco, Calif., and associates. Offering—Expected late
in September.'

share of preferred and

par

received

Co.

Commission for authority to issue and sell 100,000 addi¬
tional shares of common stock (par $5). Business—Sec¬

Zenda Gold Mining Co., Salt Lake
City, Utah
Aug. 18 (letter of notification) 1,200,000 shares of comtnon stock (par 10
cents). Price—At market, but not less
than

Gas Co.

William G. Marbury, President of Mississippi
Fuel Corp. said his company was withdrawing

Leonard

Consolidated Freightways,

Wisdom Magazine, Inc., Los Angeles, Calif.
July 14 filed 6,600 shares of 5% cumulative preferred
«tock (par $100) and 6,600 shares of common stock (par
stock.

was

that approximately
be required during

York.

common

Laclede

stock.

Connecticut Light &
March 1 it

share of

Stuart

•

& Hutzler.

Proceeds—For expansion program.

Inc., Sayreville, N. J.
Sept. 10 (letter of notification) 150,000 shares of common
*tock (par $1). Price—$2 per share. Proceeds—For new

one

Halsey,

1952

Aug. 26 stockholders were to vote on authorizing an is¬
sue
of $500,000
convertible debentures or preferred

None.

Wilson Organic Chemicals,

one

bidders:

an application with
the Missouri P. S. Commission for
permission to purchase stock control of Laclede Gas Co.

Oct. 1 for the

A Cleveland Electric Illuminating Co.
Sept. 11 it was reported company plans to raise about
$28,000,00 later this year through the sale of additional
common stock, probably to its stockholders on a l-for-5

Jacinto

$10) to be offered in units of

•

Sept.
River

company

sell

together with one $9 note and

common
Texhead Royalty Co.
Price—
#20 per unit.
Proceeds—For acquisition of oil and gas
royalties in the Williston Basin area.
Office—415 San

ftfosle

announced that it plans to issue
about $12,000,000 principal amount
mortgage bonds.
Underwriters — To be deter¬
mined
by
competitive
bidding.
Probable
bidders!
Halsey, Stuart & Co. Inc.; Glore, Forgan & Co.; Blyth
& Co., Inc. and Lazard Freres & Co. (jointly); The First
Boston Corp.; White, Weld & Co. and Shields & Co.
(jointly); Smith, Barney & Co.; Kuhn, Loeb & Co., Sal¬
omon
Bros.
&
Hutzler
and
Union
Securities
Corp.
(jointly); Equitable Securities Corp.; Lehman Brothers
and Bear, Stearns & Co. (jointly); Harriman Ripley As
Co., Inc. Proceeds—For new construction.
4

and

first

purchase from the company of $5,250,000 of equipment
trust certificates to be dated Oct. 15, 1952 and to mature
semi-annually from April 15, 1953 to Oct. 15, 1967, in¬

(notes due

two

Jan.

(10/1)

Bids will be received up to noon (EST)

Wilhead Royalty

Thursday, September 18,1952

Kansas City Powsr & Light Co.

Co.

Kidder, Peabody & Co. (jointly); Merrill Lynch, Pierce,
Fenner & Beane and White, Weld & Co. (jointly); Harriman Ripley & Co., Inc.; Salomon Bros. & Hutzler.
(2) For stock, Blyth & Co., Inc. and Kidder, Peabody &
Co. (jointly); Coffin & Burr, Inc. and The First Bos¬
ton Corp. (jointly); Harriman Ripley & Co., Inc.

{EST), Sept. 30, at Two Rector Street, New York, N. Y.

company,
shares of

Power

announced company soon after March 1,

1953, intends to issue and sell $6,000,000 of first and
general mortgage bonds and sufficient common stock to
yield approximately $5,000,000 to refund the then out¬
standing short-term notes. Underwriters—To be deter¬
mined by competitive bidding. Probable bidder—(1) For
bonds, Halsey, Stuart & Co. Inc.; Coffin & Burr, Inc. and
The First Boston Corp. (jointly); Blyth & Co., Inc. and

petitive bidding. Probable bidders: Halsey, Stuart & Co.
*nc.; Blyth & Co., Inc., Smith, Barney & Co. and White,
Weld & Co. (jointly); W. C. Langley & Co. and The First
Boston Corp. (jointly); Union Securities Corp. and Lehenan Brothers (jointly).
Bids—To be received up to noon

ciock of this

was

...

70$o75 shares of common stock (par $100)
one new share for each nine/shares of
AnWriS^n Telephone

preferred stock held.

Telegraph Co., the parent, presently own$ ^DfOxi-

mately 90% of the outstanding common stock..

;

Price—

At par.
Proceeds—To repay construction loans and for
further expansion.
Underwriter—None. Offering—May
be made
'

Sept. 22-.

•Pacific Telephone &

Telegraph Co.

(11/18V

Sept. 3 California P. U. Commission approved a propos?
authorizing the company to issue and sell $35,000,05
of debentures due Nov. 15, 1979. Proceeds — For re

payment of advances and bank loans and for new con
Underwriter—To be determined by competi*

struetion.
tive

Inc.;

bidding. Probable bidders: sHalsey, Stuart & Co.
Lehman Brothers; and Union Securities
Corp

(jointly); White, Weld & Co.; Morgan Stanley & Cn. Bid
(PST) on

—Tentatively set to be received at 8:30 p.m.
November 18..

Number 5152

Volume 176

The Commercial and Financial Chronicle

Southwestern Public Service Co.

'San Diego Gas & Electric Co.
July 1, L. M. Klauber announced that of the more than
$18,000,000 required for capital improvements in 1952,
•approximately $4,000,000 will become available from de¬
preciation reserves and earned surplus, while the re¬
mainder must be secured through the sale of securities.

Aug. 4 it
tional
first

1953.
may

•

Blair, Rollins &

—

Additional

also

Gas

preferred

But

and

com¬

schedule,

other

Treasury

paying the
18 years for

some

forthcoming

Stand¬

midwest
The

markets

initial

Standard Oil Co.

its

financing
poration

by
in

holders

recent

will

for

stock

Offerings Ahead

Next week will bring a sprink¬

ling of corporate offerings of lim¬
notes ited
dimensions, largely of the
competitive bidding variety.
On
:as
near as
can
be learned it is
Monday Pacific Power & Light Co.
•doing little more in the market. will
open
bids for $7,500,000 of

2%%

through the exchange period, but

hvhich
■the

regarded

are

government

market

has had
supply

-of

this

has

"Views of some

changed the
observers with renot

•-gard to the basic money situation.
vThe consensus is that unless the
Reserve

does

rates

interest

face"

"about

complete

may

ex-

to stiffen somewhat
through the balance of

fur-

;pected
ther

the

;year.

with

for

economist

commercial

one

the

banks

interest of

vestors, centers around the forth¬

slated

the

Co.

day.

sell

com¬

Illinois Pub¬

50,000 shares
and $5,000,000
up

for bids

William J. Shirley
William J. Shirley, 47, Assistant
The

Public

National

Bank and Trust Co. of New

died suddenly on
Mr. Shirley was

York,
Sunday, Sept. 14.
associated with

Public National Bank for 15 years.
He was a graduate of New York

Chapter of the American Institute

Banking and of the Graduate
of

Banking

Rutgers

University.

put back presumably to await
favorable market conditions.

Walston, Hoffman

(Special to The Financial Chronicle)

SAN

Corporates Sluggish
Even though

ket. has

the Treasury mar¬

tended

the details of the
>ut

over

the

harden

new

issues

week-end, the

FRANCISCO,

Thomas

since

Munoz

came

man

cor¬

G.
are

Moran

with

and

Calif.—
John

Walston,

Hoff¬

Goodwin, 265 Montgomery

Street, members of the New York

porate end of the list, that is the

and

Sgilt-edge classifications, have not
developed any real snap.

changes.

•

Nor has there been any marked

offerings

$roing

bit

which

found

the

the slow side in the

early stages. Reports indicate that
the bulk of the Tennessee Gas
transmission

Illinois

bonds

issue is still around.

Central-Railroad's

were

elow

$5,000,000.
Meantime ArLight Co.'s recent
is making slow progress.'

Stock

1962

103%
The

PORTLAND, Ore. —W. Theron
added to the staff

&; Co.,; Inc.,

Cascade

day

d, associated
with H. M.'Byllesby & Company,
Incorporated,
ed

New
Se

York

City,

1952

Preliminary indications

are that
lumbus & Southern Ohio Elec-

ric's

new

issue of 90,000 shares of

umulative preferred stock is at-

' (special

BOSTON,

Mass.

the

share
has

—

Edith

The

Alperin is associated with Michael

Alperin & Co., 154 Boylston Street,

210

are

un¬

Oil

and

make

70%

King Merritt Adds
(Special to The Financial Chronicle)

earnings

net

last

five

LOS

King

Merritt

South

111. —Gordon

Wortman is

now

with

with G. R. Wort-

EUREKA, Calif.—Charles Rus¬

Sixteenth

Witter

Co.

(Special to The Financial Chronicle)

staff

The

system
two

cost
Oil

the

projects
about
Co.

Barth

added to

Co., 210

Join Gill Assoc.
TOLEDO,

Ohio—Phil J. Evans*

.Inc.,
>

joined^
Gardner

Stock

Exchanges.

With Lamsbn Bros. Co.
(Special to The Financial Chronicle)

OMAHA,
Koane is

Neb.

now

—

Jay B. Mc-

with Lamson Brost

Co., City National Bank Building.

com¬

are

Continued

ex¬

from

page

$30,000,000.

(Indiana)

Dealer-Broker

States and,

with its
fully integrated,
being engaged in exploration, for,
is

production,

refining,, transporta¬

tion and marketing of petroleum.

the

Riverside

mar¬

brand

names

South Hope

principally

New

its

Wyoming,

Kansas,

net

and

reserves

Colorado,

Company—Data in current issue of "Gleanings"—
Francis I. du Pont & Co., 1 Wall Street, New York 5, N, Y«

oil

and

f"
•

and

of crude

natural gas liquids were estimated

Singer &

Southern

Louisiana,

Mexico

Corporation—Analysis—Lester, Ryons & Co., 623
Street, Los Angeles 17, Calif.
•

Co., 74 Trinity Place, New York 6, N. Y.

from

Texas,

Analysis and review of the Cement
10 Post Office Square, Boston %

Southeastern Public Service—New circular—Troster,

company's production of crude oil
and
natural
gases
is currently
of

—

(

Rohr Aircraft

and "Standard White Crown/' The

obtained

Co.

Mass.

"Amoco," "American," "Pan-Am,"
"Utoco,"1 "Standard Red Crown,"

States

Cement

Industry—Lerner & Co.,

products in 41 states

familiar

(Special to The Financial Chronicle)

Associates,'
Building.
•

the New York and San Francisco

largest oil companies

subsidiaries,

of J.

Calif. —Guer¬
been

(Special to The Financial Chronicle)

Moorhead, Minn., which will con¬
nect with the presently
existing
distribution

has

viously with Dean Witter & Co*

30,000 bbl.

Mandan

Smith

and Guernon E. Moore have

Joins Davies & Co.

major
expenditures is

from

Street.

Gill

the

thct

joined

Harrison, 2200-

J. Barth Adds to Staff

Hoffman & Good¬

SAN FRANCISCO, Calif. —
a day
refinery at Mandan, North!
Theodore H. Kobey has become
Dakota, in the rapidly expanding
affiliated with Davies & Co., 425
Williston Basin area and a prod-,
Montgomery Street, members of
ucts

pipeline

have

West Seventh Street. He was pre¬

(Special to The Financial Chronicle)

tive

Mason

the

With Walston, Hoffman

Dean

affiliated

Jackson. 8c

Baum William C. Carson and Ma¬

don

its subsidiaries, and the
balance for expansion and work¬

become

Webber,

LOS ANGELES,

for

has

(Special to The Financial Chronicle)

Fifth Street.

pany and

capital

Paine,

SACRAMENTO, Calif.—Herbert

win, 635 Fifth Street. Mr. Harms
was formerly
Eureka representa¬

construction

ANGELES, Calif.—Joel E.

staff of Richard A.

Lynch Adds

Walston,

1151.

Inc.,

Three With R. A. Harrison

Pierce, Fenner & Beane, 231 South

with

Co.,

(Special to The Financial Chronicle)

rion

Merrill

With Paine, Webber Cow

Co., Aurora National Bank
Building, members of the Midwest
Stock Exchange.
man

the

Ros^

Curtis, 626 South Spring Street.

(Special to The Financial Chronicle)

the

—

Broadway.

LOS

AURORA,

expiration

ANGELES, Calif.

Herrt has become connected with-

years

With G. R. Wortman Co.

part

One

Avenue.

MacDonald
con¬

proceeds of the issue will

capital.

ANGELES, Calif.—Charles*
Hathaway has joined the staffr
Curtis Lipton Co., 338 Soutl*-

Western

to retire $81,500,000 of bank loans of the com¬

ing

Co.*

Street.

LOS

capital stock.

rights. The debentures

Seventh

With Curtis Lipton

sell Harms has become associated

used

staff of C. A. Botzum

West

(Special to The Financial Chronicle)

extra dividend in
Co. (New Jersey)

Standard

100%.

Oklahoma,
L.

history.

the

and

paid

Alperin

highest

$57,814,000, equal to $3.76
capital share. The company is
currently paying a regular quar¬
terly cash dividend of $0,625 per

subject to redemption through
operation of the sinking fund at

to the

were

are

the

to the financial chronicle) r.

the

were

invest¬

outstanding

conversion

being

Joins Michael

runs

$766,718,000

1, 1979.

by maturity

following

under

o w a r

(Special to The Financial Chronicle)
equal sinking fund payments be¬
LOUISVILLE, Ky. — James A.
ginning on Nov. 1, 1962 and an¬
nually
thereafter
sufficient
to McCrocklin is with Merrill Lynch,

ket branded

Lancelot H

Sept.

Standard and its subsidiaries

Lancelot Howard

bbls.

ANGELES, Calif.—Russeir
W. Porteous, Jr. has been addect

and its subsidiaries amounted

pany

187

will

company

95,000,000

over

LOS

ranging from
prior to Oct. 1 1957

1951 the

and its subsidiaries pro¬

in the company's

prices

after Oct.

year

During the

Williston

They are
option of the

the

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

refinery

share.

per

100%

one

Jones has been

ansas Power &

Break in Clouds

$92

in the United

(Special to The Financial Chronicle)

of; Field

acres

Price—

general

Underwriter—Merrill Lynch, Pierce^

daily input of crude oil and
natural gas liquids of over 542,000
bbls.
In August 1952 crude oil

through

redeemable

pected to

Building.

was expected tor
proposed issue of 100,00Q-

Beane, New York.

age

capital stock at $87
Oct. 1, 1957
thereafter through
Oct. 1,

Ex-, pany.

With Field & Co.

reported to be clean-

balance in dealers' hands believed

Francisco

new

ing-iip in good fashion with the

issue

San

record

covering

crude oil and natural gas liquids
and their refineries had an aver¬

into

per

Standard

acceleration of demand for recent
pew

vertible

the

Joins

(10/7)

statement

consolidated earnings of the com¬

debentures

new

proposed

each

group

debentures

uled for earlier consummation, but
'was

The

redeem

registration

sub¬

banking firms which is
derwriting the offering..

and

mortgage bonds

same

Underwriter—White,
Offering—Expected early in

For the first six months of 1952

Morgan Stanley & Co. heads
nationwide

has

preferred

new

/and Home Finance Administration.
This operation had been sched¬

held

Service

Fenner &

ar¬

duced

17, 1952 at the subscription price
of 100%.
The subscription offer
will expire at 2.30 p.m.
(CST) on
Oct. 6, 1952.

serial notes. Central
lic

filed with SEC

company

$100 principal amount

company

School

some

for

bidding,
$17,000,000
of
bonds together with $6,000,000 of

bonds.

petitive

$160,■t)00,000 of housing loans to be
-marketed by the Federal Housing
for

bidding

operation

following day Appalachian

Cashidr

ment bankers and institutional in¬

coming

current

mortgage

The

before the

the investment world, both invest:

Light

closes.

For the moment the

its

Electric

firmer

-considered quite likely

:^ear

first

rates
rise in the rediscount rate
expecting

Duquesne

through the sale of $14,000,000 of

of first

larger
tecord

day

same

will complete the second and final

phase

this week.

money

But

The

4,000,000

cor¬

ment

temporary,

the added support of a free

bonds.

new

Traditional

York.

Stock¬

years.

entitled

debentures

circumstances

New

of June 30, 1952 to be 1,827,000,000 bbls.
The company has
acquired leases
on
more
than

Offer'g

industrial

Co.,

30-year 3 V$ % debentures due Oct.
1, 1982. This offering represents
the largest convertible debenture

scribe

due

operate

(Indiana) is of¬
rights
$139,647,200 of

for

•/Federal Reserve Board is standing

Treasury

shareholders

funding, it is apparent that the
credit.

Sept.

financing has been

Oil Co. (Ind.)
fering

fering of convertible debentures,
now being made to common stock¬
holders, indicates there is a wide
interest among investors in any of

True, the Reserve is supporting

construction.

new

October.

(Del.)

Underwrite Standard

pre¬

Co. of Indiana's huge of¬

Smaller

for

Co., which now
of outstanding United

Basin.

connection
these securities which reach public
Oct. 1 re¬
offering.

money

Meantime,

5%) for subscription by common stockholders^
redeem 2,053 outstanding shares of 5%
preferred stock (par $100), to retire bank loans and

Morgan Stanley Group

judging by the comments

Oil

shares, 27.01%)

carrier."

interest.

liminary inquiry.
Similarly, conjecture

of about

corporate purposes.

is the center of considerable

new

La.

shares of convertible preferred stock (par
$25).
To be supplied by amendment.
Proceeds—For

around the Street the senior stock

ard

Co.

Chicago

considerable

which also is

mon

Gas

^White's Auto Stores, Inc.

300,000 shares of the utility's

the

Natural

Sept. 2 stockholders approved the creation of an author ¬
ized issue of 500,800 shares of
preferred stock (par $30),.
of which the company plans to offer about
170,000 shareaas convertible
preferred stock (carrying a dividend rate-

pri¬

Underwriter—None.

discussion of prospects for the

Western

financing
done

was

Sept. 25, 1950 it was announced that this company had
been formed to build, own and operate a
petroleum
products pipeline from the Texas Gulf Coast to St. Louis,

Thus far there has been little

rfast to its views

stock

this previously

Electric Bond

3,165,781

"common

tracting

its

and

Corp., Shreveport,

—

Gas stock.

/Terminal Co.

months'

bond

necessary;

it United States Pipe Line Co.

If offered competitively, the bidders may include

with

its

10 Electric Bond & Share Co. applied to SEC for

(owns

Halsey, Stuart & Co. Inc.; Kuhn, Loeb & Co.; Morgan
'Stanley & Co. Proceeds—To meet in part the outstand¬
ing bond maturities of Southern Ry. and New Orleans

toward

Weld

.Aug. 20 the ICC denied the application of this company
for permission to sell not exceeding $46,000,000 of new
"bonds without complying with the usual competitive

(with offer to be made
the proceeds

use

Proceeds—To

Southern Ry.

..highest rate in

public offering expected
Ryan, of
principal officer:*
of the corporation.
Underwriters—Probably Dillon, Read
& Co. Inc. and Glore, Forgan &
Co., both of New York*.

authority to offer for subscription by its stockholders
525,000 shares of common stock (par $10) of United Gas
Corp. on a 1-for-10 basis. Price—To be named later.

New York.

the

and

4»

for at least two years. E.
Holley Poe and Paul
70 Pine St., New York, N. Y., are the

addi¬

some

Proceeds

Underwriter

scheduled for Sept. 25.

With

financing

stockholders)

United

Sept.

ing fund debentures. Proceeds—To repay $1,200,000 loan
and for working capital.
Registration — Tentatively

rules.

stock

vately. Underwriter—Dillon, Read & Co. Inc., New York.

(10/15)

.'Sept. 3 it was announced that company plans to issue
•and sell publicly $3,750,000 of 15-year convertible sink¬

Co. Inc.,

ranged for privately with

reported that company may do

which, it is estimated, will involve
approximately $23,000,000 for the year ended Aug. 31,

ferred stock financing.

Seiberling Rubber Co.

was

common

construction program

& Co., Inc. handled previous pre¬

^Underwriter—Blyth

(1053)

Also in the same issue are a selected list of Convertible Bonds.
iRix Athabasca Uranium Mines, Ltd.—Bulletin—A. G. White &
_

•*

,:Vu Co.,;300 Bay Street,
"

■'•

Toronto, Ont., Canada.

:'iI

Incorporated—Bulletin—-Remer, Mitchell & Reitzel,
inc., 208 South La S'alle Street, Chicago 4, 111.

Tampax,
;h:

(1054)

Third.

Continued jrom page

world

than double.
Demand for energy in all forms
will

could

improve

which are

for

pay

and

re¬

his

our

behind

effort

the

Perhaps

foreign
the producers and encouraging high-

point,

third

few years

Our

geological

only

future.

and

prosperity

and

—

producing

our

strength. But in the consumption
of materials,
the application of
this

prices of

Consumption Picture

free

the

than

sumes

risen

advantageous to
and consumer alike."

world.
much

aware

that

methods of re¬
covery and extraction, cut the cost
of handling low-grade materials,

rapidly than the aver¬

all other wholesale

must improve our

get

and

100, this trend for
materials shows that be¬

unit of

our

In the vast field

the century as

able

all

1900

tween

materials

1940,

and

logging, conquer the pests
and diseases that deprive us of
more
trees
than
do fires, find

symbol of America's self-suffi¬

ciency in raw materials.
fact

The

the

where

cerned,

entirely

is that

matter

believe

con¬

are

used

than

terials

than

likely

the

that

evidence

consumed;

now
pro¬

The Commission could find

duce.

reverse

trend

itself.

was

In 1900,

produced 15% more materials
than
we
consumed, except for

In 1950, we ran a deficit—
9% more than we

food.

consumed

By 1975, the deficit
increase to 20% by
value of all the raw materials we
produced.
may
well

consume.

This then is the

her

crisis
is

our

the

reasonable

as¬

decline in

with

this

background
hope of our

United States and the free

world.

standard of

living, the slow¬
economic growth.

our

The problem is not

suddenly have

that

Three Approaches

will

iron;

TJhe

Commission

to Solution

made

some

70-odd recommendations for solv¬

other basic materials, ing various aspects of our material
activity will problem. Every recommendation
suddenly die. The essence of the was based on one or moje of three
danger, the essence of the Ma¬ approaches to solution:
terials Problem, is the real cost
First.
We can get more mate¬

copper,

and

♦

that

economic

of materials—the hours of human

work,

the

needed

dustrial
energy

the

material

labor

having
and

capital

pound
a

into useful form.

threat

amount

bring

unit

in¬
of

We face

expend

capital to

Better Use of

need

and

of old

new

putting
to

work

better use

materials—brings

forward more jobs

These

and

clear

the nature

capital

before

Many major tasks which indus

for technology:

cities,

the less developed

coun¬

world

obstacles must be

market,

There

overcome.

stubborn

are

of them

most

and

obstacles,

the

into

are

origi¬
the countries that have the
Some

them

outside

it hard for

that makes
capital

for

to carry-on a le¬

gitimate business, whether for de¬
velopment or trade; a sheer polit¬

abundant raw materials, ical
instability that
as
substitutes for the vestors
reluctant
to

makes
put

in¬

their

I will not take th
time to review them now, but
do want to talk to you about ai

important fact concerning indus
try that impressed

itself on me a

dug into the materials proble

I
It

that remarkably little wa

was

the

about

known

future

deman

supply of materials, and tha
there was a serious lack of long
and

planning in our productio

industries.

Up until the second world wa'
perhaps, industries could affor
to
let materials problems wor
themselves out at a leisurely pac

of today

But amid the pressures

divided

world

vealed

materials
that

chance

and

own

our

th
and casu'
us with th
too
slim t

position,

drifting
provide

will

events

solution
is
gamble on. The stakes
right

are

high.
Long-Range Planning Needed
so,
I submit that Ion
planning is necessary,
or less permanent scarciti

And

not

scarce,

aspects

separate

problem.

range

countries, and

back

flow

materials

implicit in the report'

are

discussion
the

flow to

can

the material

try should undertake, if we are t
mitigate the pressure of the scar

Obstacles

Man-Made

problem which this Nation faces

people.

But

have tried to mak

port,

means

why th

reasons

sufficiency should be rejected a
an objective of policy.
I have given you only a partia
outline
of the
Commision's1 re

capital to promote
their economic
progress
and to
improve the living standards of

their

the

are

Commission stated flatly that self

of building up

instance,

My second point—the

market

resources—super-nationalism,

Materials

well
as
in the
further
development, that I want to discus§
our
recommendations, and
industry's role, for dealing with
the
materials
problem
of
the

The danger of

arrest

tries

man-made.

materials

by Russia and most of
satellites
is
virtually
un¬
It

—

tariffs.

nations

developed

less

should be don
with the rifle shot of subsidies
not with the shotgun spread o

materials

the

developed

production,

domestic

when necessary it

The indus¬

belief.

less

The

nate in

Technology

people

are

need

nations

that

economical.

be made

our

tering

free nations of the world
apparently do not share this

have.

production
There may be
cases
security demands fos¬

range
more

higher cost may plague an i

dustry, its managers need to kno
about it well in advance.
Deve

oping

sources,

new

arranging f

imports, improving technology
these

things

take

planning

they take time.

greater danger: the ultimate

ing of

covery

when

economic

the

which military

depends.

only aluminum for money to unreasonable hazard.
Most of these particular obstacles
copper, and titanium for stainless
goes on inside Communist coun¬
steel, but other materials for as are beyond direct control, either
tries, but this much is clear: Com¬
Tech¬ by investors or other nations. But
munist industrialization has been yet unguessable purposes.
new
syn¬ much can be done to smooth them
so
recent, its total capacity is nology can produce
thetics. It must explore the quali¬ out through patience and under¬
still so limited, that those coun¬
ties of the unused materials, of standing, and through persistence
tries must have rich and ample
which
there are an abundance. by our foreign investors "and op¬
supplies of the very materials
We are making use now of only erators; and also through a greater
whose scarcities begin to afflict
about
one-third
of
the
90-odd awareness of our materials needs
us.
known elements.
on
the part of our officials who
It is a sobering thought, and it

picture: soaring

costs.

sumption that many minerals lie
there awaiting discovery.
We do
not know too much about what

shortage is real, but there

threat of

different
kind that I
lends a special urgency to

touched.

demands, shrinking resources, and
the consequent pressure toward
rising real

controlled

produce more ma¬

consume

factor

The land area and the

have crossed the great

industrial divide:
We

another

thinking about materials.

our

materials

raw

There

that, there

trial

position at the same time

strengthening

base

of
well

improving our se¬

are

curity

day-by-day

the

from

of fact than of

pollution, the re¬
of useful wastes need to

elimination

genuine concern.

stop,
by

importing

materials, we are benefit¬

not harming, our economy.
with stockpiles as a back¬

ing,
And,

To me, the interdependence of
must cut the* the free world is a matter more

import high-grade iron ore, once

cut our real cost by

scarce

;;

prices had dropped to 94.
But
metal or a mineral fuel
ay
1950, the prices had risen better methods of using the trees
of which the quantity used in the
adruptly
to around
114.
This we have, bring new species into
United States since the outbreak*
means
that
between
1940 and use, reduce the enormous waste.
of the first World War did not
1950, raw materials prices rose About one quarter of the total
exceed the total used throughout
about 20% more than the average wood content of a tree is left ih*~
the world in all the centuries pre¬
of all other prices.
Since then, the forest, and another quarter is
ceding.
in
there have been both great rises lost
milling.
Proper forest
We are net importers of quite
and subsequent falls.
management* to establish forests
a
number of materials that we
This above-average rise in ma-^ on a sustained yield basis is not
formerly exported as surplus: Pe¬ terials
prices cannot be taken as widely enough used, especially in
troleum,
copper,
lumber, zinc, conclusive evidence that real cost the smaller holdings.
lead,
to
pick some prominent is
Water for industries.
Here the
going up, but it should give us
ones.
We are even beginning to
scarcely

longer. To the extent that we

can

of our renew¬

costs of

raw

resources,

any

many

who

from each

energy
fuels.

protecting our industries from the
competition of "low-wage foreign
labor" simply does not hold water

some

aware

news

idea of

But the time-worn

blow.

Americans do not
belief. And we must

that

years,

But

world.

free

the

steps should be taken to ease

believe in the interdependence

the
of deducting

mate¬

rials, some people, some businesses,
would be hurt. And in such cases,

and *

given

nating tariffs on scarce raw

exploration expenses that oil men
have.
On the technical side, we

prices.
world, it con¬ Using an index which represents
that relationship at the turn of
one-half of all

produced

should

privilege

tax

same

materials,

scarce

miners

that

the
materials have

recent

all raw

age of

in the free
Indeed, we have used so
materials
that
there
is

materials

However,

Although the United States has
less than one-tenth of the popu¬
lation

usually makes it impossible
a
satisfactory trend
real cost as it is defined here.
establish

kind
The

statistical

data

principle has contributed to
of picture:

this

Inadequacy of

answer.

manpower

materials on that
supplier producing higher value items.
True that in reducing or elimi¬

terms

....

and

this

producers,

our

sap

diverting

alone

tricity

cost

economic vitality by
and capital
would be better employed

can

more
rapidly.
but for elec¬
The economic opportunities in
Geologists
tell
us
that
the
it will more than capital from other industries or
free world cooperation to produce
services that would have higher United States probably still pos¬
triple.
materials, are
tremendous.
The
many
large deposits
of
For the rest of the free world product value; and the total na¬ sesses
less developed countries—in the
tional
production would be re¬ familiar minerals that have not
the percentage of increase could
duced
by
loss
of the greater yet been found — probably as Americas, in Africa, in the Middle
be even larger.
East and
Southeast Asia — have
values which that diverted effort
many
and as large deposits as
I know that none of us in the
could otherwise have turned out. those we already have discovered. rich stores of materials; the in¬
United States is easily accustomed
dustrial nations have the neces¬
Productivity does not need to But they are deep deposits, or at
to the idea that raw materials—
decline in the resource industries least hidden deposits that do not sary skills, and the capital. These
an adequate supply of cheap ma¬
facts suggest the possibility of a
to
produce
this
result.
If it have outcroppings. The old pick
terials—can be a problem to us.
new
era
of advancement for the
merely lags behind the general and burro methods of prospectors
In fact, partly because our na¬
world
which
is
dazzling in its
rise in productivity — the great will not find them.
tional patrimony was so rich, we
promise.
dynamic of our nation's progress
For this job, we need new tools
have become the supreme advo¬
In our report we said:
—it can impair economic growth. and new methods, and economical
cates of the idea that man and
"We believe that the destinies
As our report points out, this is methods
to
recover
ores
when
his labor are the most valuable
of the United States and the rest
not the sort of economic ailment
they are deeply hidden. We need
resources of all, and that inanim¬
that gives
dramatic warning of new laws to permit profitable, of the free non-Communist world
ate materials should be used as
are
inextricably bound together.
its onset: "it'creeps upon its vic¬
large-scale search.
The Commis¬
fully as possible to give men the tim with insidious slowness." It
If we fail to work for a
sion
thought that the
present
greatest amount of return for the
rise in the standard of living of
is, in fact, the very result of the mining claims law could be im¬
effort they put forth.
the rest of the free world, we
creeping scarcities with which we proved and that leasing rights for
I do not think that any of us
thereby hamper and impede the
are chiefly
concerned.
exploration and development on
further
rise
of
our
own,
and
The question
would want to change that prin¬
naturally arises: public lands would help.
The.
ciple. Improving productivity, con¬ What are the real costs of mate¬
lessen
the chances of
Commission also thought that tax - equally
stantly increasing the output per rials today? Is there any evidence
democracy to prosper and peace
depletion allowances were justi¬
hour of work, has been a large
to reign the world over."
that they are rising?
fied
incentives for finding and
factor
in our economic
growth
It is not an easy question to
It's a fine statement.
I deeply

nearly double,

will

policy fosters higher real cost for
all of us—the cost increases that

prospects:

"Importing

low

domestic

cost

At the
time, it offers the greatest

same

wasteful pattern.

discouraging

it.

approach to solution of the
materials
problem, present the

knowledge of re¬

extends

the

A Wasteful Policy

This is

third

minerals,

than they

wants

farm

even for 25%
would cost abroad.

get them

can

knowledge of what
have.
On
most greatest difficulties of all.

our

materials

serves

if it

the

idea will
off before he puts his money

materials mapping should be pushed ahead

divert manpower

thus

domestic

the

that,

after

to make very sure a new

finding and mak¬

use

ideas

new

And,

businessman

them.

important step would be to

into

cost

circulated.

the
ad¬

sources.

both quantity and

real

Rising

better

ing

amounts of ma¬

resources

dwindling
quality.

indus¬

for

water

for

Demand

from

terials

1975.

tries

equivalent

win

products

timber

terms that are

Now the first:

primary

nations

for

education

get more mate¬

can

other

vantageous to both us and

Meeting the Threat oi
Creeping Scarcities
of

from

rials
free

18,1952

Financial Chronicle...Thursday,September

The Commercial and
46

our

of making atomic en¬ foreign aid programs. ^
Here in the United States
solar energy broadly

task

long
ergy

and

exhaustible

The jobs that
do

are;

to begin the

soon

relieve the

useful to
our

affair!'and

is not too

pressure

mineral fuels.

technology should
more
will

endless—and

The jobs that technology
can
do are sharply limited.
We
have
a
major stumbling block,
and that is a shortage of trained

develop.

manpower.

We must take steps to
train more. And we

direct

create

some

caught

still' act
of

raw
we

of the

ways,

many

not

foreign

our

materials.

had

labor and

obstacles too.

had

sentatives

bur thinking has
with events — we
we

Would
groups

surplus

behave as

unemployment for our

capital! We afe import¬

ing .large quantities of copper,
zinc,
manganese; "'ttlhgsten
and
mercury — to name only a few

not

possible

companies,
of

for

industries,

repr

together in organizations for Ion
range research on the future <
materials that affect their bus
nesses?

I know that the Nation

Industrial
done

the

Conference

excellent

Board

research,

Committee for Economic E)<

velopment, and others. We nee
of this type of work in tl
field of materials.
Inter-indust

groups need to do continuously f
themselves the kind of study th
that our deficit materials [r- but we are the President's Materials Poli<
research is directed toward solv¬ making things harder for ourselves
Commission
attempted
for t"
by adding import duties. Tariffs
ing first problems first.
entire economy.
And it is not
rials and more energy from our
But even when technology pro¬ range from 9 to JQ% of the import
job that can be done once, a
domestic resources at low cost.
vides the answers, the savings and value on the commodities I just
then forgotten. It must be carri
And we have"' a Buy
Second. We can make better use gains are not always put to work mentioned.
on day-by-day, and year-by-ye
of what we get, and find ways .promptly... We
know right now American Act which dates from
Such planning reauires a surto
use
new
and
abundant ma¬ how to increase the output of our depression days and which is in¬
of a multitude of different ma
terials
as
substitutes
for
the farm acres by anywhere from 80 terpreted to rhean^ the Govern¬
rials, and the economic and poli
to 200%.
scarce.
But it takes time and ment must buy domestic materials
see

will

that

need

to make

sure

Number 5152

Volume 176

The Commercial and Financial Chronicle

produced.
It implies a study
supplies of energy that can
be provided, and the cost of those
supplies; and, importantly, it de¬
mands
a
continuing review of
are

There is serious need
to inspect our political
and our
economic instruments and policies
bear

materials,

column

the

need

determine

they will

what

Inflation

industry and

ourselves:

tion?

Will

receive

Will

the

materials

sufficient

atten¬

action

necessary

'taken?
A

over
a
'

with

rests

the

Washington in January—

President

new

and

Con-

new

But by far the greater part

gress.

;

clearly

those

answer

Administration that will take

new

the

with

lie

must

answer

in¬

dustry.
The

Inc.,
Building.

very

NATIONAL
14
A

vital

all

our

cern.

have

confidence

every

we
develop enough confor the future, enter vigorously into Aong-range industrial
planning, and press for political

necessary,

standards will rise,
will

grow

will

have

guard

and

living

our

and

military

might

freedoms.

With First California

(Special to The

Financial

week's

Last
not

c o

did

n m

because it arrived too

run

the advice to buy

FRANCISCO,

Calif.—

Ralph W. Wood has become

asso¬

ciated with First California Com¬

countless

*■

•

SAN

Forming Co.

FRANCISCO,
R.

A. R. Nowell
the securities
was

his

and

with
the

past conducted

Nowell

six

coming

reaction

The

news.

much

the

forecast

will

STOUT, Secretary.

the

New

York

will

associ¬

stock

October

payable

are

stockholders

KEMP,

record

1952.
Treasurer.

120

Broadway,

New

York 5,

September
DIVIDEND No.

The

Board

Meeting

dividend

the

Plywood
Corporation

Directors

of this Company, at
this day, declared an interim
third quarter of 1952 of Sixty
a
share,
on
the
outstanding
of
this
Company, payable on
1952, to stockholders of record

held

for

the

Cents
($0.60)
capital stock
September 27,

United States
1952.

10,

400

business
C.

September

18,

1952.

LANGLEY, Treasurer.

For

the

quarter ended

July

of 35c per share

cash dividend

31,
on

1952, a
the out¬

standing common stock of this corporation
has been declared payable October 10, 1952,
to stockholders of record at the close of
October

business

1952.

SIMON OTTINGER,
New

Secretary.

York, N. Y., September 10, 1952.

do I see re¬

1 tiew England Gas ^
| and Electric Association

ahead.

in the weeks

What will

Common

business

reaction ahead

saw

mid-July,

covery

and

1952,

Honduras Rosario

But in the final essence,
as

capital

Preferred

Corporation have de¬
cents per share on
stock.
They have also
62\2 cents per share on
stock.
The dividends on

37V2

Mining Company

just

this

capital

dividend

Common

the

dividend

Preferred

the

1952.

Machinery Corporation

Directors

declared

happen in the long

NOTICES

PACIFIC GAS AND ELECTRIC CO.
DIVIDEND NOTICE
Common Stock Dividend No. 147

COMMON DIVIDEND NO. 22

CORPORATION
CAPITAL

DIVIDEND

the

The

GENERAL REALTY & UTILITIES

The Board of Directors has declared a semi¬
annual d'vidend of 25 cents per share on the
Capital
Shares
of
the
Corporation
payab'e
September 30, 1952, to stockholders of record at
the close of business September 19, 1952.

The

regular

Trustees

have

declared

quarterly dividend of
twenty-live cents (25c) per share
on rhe common shares of die
Association, payable October
shareholders

FOX,

Treasurer.

record

10,
at

tember
of the

(50f)

September

quarter

the close

of business

22, 1952. The Transfer
he closed.

on
September
Books will not

K. C. Chiustensen, Treasurer

moorl, jr., Treasurer
San

Francisco, California

cents per

payable

declared,

QUI

stockholders of

1952, to

Sep¬

business

The transfer books

26, 1952.

third

1952.

of fifty

the

a cash dividend for
of the year of 50
cents per
share upon the Company's
common
capital stock. This dividend
will be paid by check on October 15,
1952, to common stockholders of record

1952, declared

10,

York

New

been

has

October

of Directors

Board

10,

the

COMPANY

September

A dividend

1952

COPPER

Broadway,

September 11, iy)2

1P52.

15,

MIAMI
61

15,

record at the close of business
September 22. 1952.

SAMUEL

September

|
|

FOB

HUP MORRIS

Company will not close.
G.

JOHN

GREENBXJRGH,

Treasurer.

104th

market's way

business.

United Shoe
The

clared

WALLACE

black

Sometimes

market takes

now

Loren

iwhite

permit of any precise
interpretation. It changes
from day to
day, week to
month.

York

cents

this

reaction may even

new

form

Hannaford

were

few weeks

months

Calif.—

will

investment

own

11,

STATIONERY

hereby given that a dividend at the
rate of $.60 per share on the issued and out¬
standing shares without par value of the Com¬

& Co. to engage in past two weeks and any fur¬
business. Mr. Nowell ther decline from here is the

formerly

Talbot

Nowell

there

reasons

•

(Special to The Financial Chronicle)

Alexander

Just

almost

now

reasons a

many

A. R. No well

circulated
today to Aay bearish. I am
afraid a inarket outlook is
are

fifteen

CORPORATION
Notice

to remain bullish, there

ago

declared

NOTICES

TABLET

CORPORATION
Nctf

before.

DIVIDEND

Bearishness
universal.

DIVIDEND
WESTERN

both

re¬

week and certain from month

300 Montgomery Street.

pany,

been

September

SAN

also

Co., 507 West Sixth Street.

November

Chronicl*)

LOS ANGELES, Calif.—Jack G.
Waldron is now with J. A. Hogle

mon
Stock
of
Western
Tablet
&
Stationery
Corporation has been declared, payable on Octo¬
ber
15,
1952, to holders of record of such
shares at the close of business
on
September
26, 1952.
E. H. BACH, Treasurer.

NOTICES

Street.

JOSEPH

here

with

met

never

peated.

never

Chronicle)

have

seen.

economy

prosper,

the

our

Bank

-Y-

cern

action
v

thought would benefit.

seen

that
.

which

stocks

Hogle Staff

(Special to The Financial

(15c) per share
day
on
the
capital
stock
of
the Corporation payable October 15.
1952 to stockholders Of record at the close of
business September 30,
1952.

ing once again a profitable chances are that any recovery
proceeding, so I mentioned a from these prices will be slow;
of

Reed, Inc.

Joins

those

National

Wall

dividend

has

Nobody can buy stocks at
eighth except by
Two weeks ago I thought
I saw the start of a reaction accident, just as nobody can
that would carry stocks down get out of a stock at the very
far enough to make new buy¬ top except by accident. The

stock-taking has revealed. I'm not
late to make the issue, but had
trying to sound alarmist about it,
but rather to generate deep con¬ it appeared. you would have
For

First

❖

dell &

are

DIVIDEND

the bottom

for America number
serious unless both

government and industry act de¬
cisively.
The materials problem
is serious, and it touches on many
matters

new

consequences

can

buying to be done,
I suggest you wait for weak¬
ness to step in."
any

❖

part of the

questions

with

They

private citizens.

My fellow commissioners and I

problem

coincide

pany,

ask

this

David S.

—

connected with Wad¬

now

necessarily at any

staff of Clement A. Evans & Com¬

expressed

not

ATLANTA, Ga. — Frank W.
Blalock, Jr. has been added to the

thing

one

up.
If you are carrying a They will both give its solu¬
comparatively light load, tion lip service. As a matter
34 I believe no greater issue lies make it still
lighter. If you of fact so long as we are in an
before American industry today..
are
tempted to do any new armament race, I fail to see
As it hopes to prosper in a pros¬
perous
America,
industry must buying at this stage, I suggest how inflation can be checked
equip itself with this radar eye you resist it."
short of deliberately forcing
of long-range planning to pierce
❖
❖
*
a
depression, and if any poli¬
the fog of the future—or I firmly
a depression, it
Then
later
in
the
same tician wants
believe we will be headed for the
backwaters of progress.
column I wrote, "If there is will be a kind of politician we
to fake, both as representatives

MARIETTA, Ga.

(Special to The Financial Chronicle)

gest you use strength to light¬ neither party wants to tackle.

actions

(Special to The Financial Chronicl*)

week to

With Waddell & Reed

Clement Evans Adds

upset the economic apple¬

cart.

important bearing on all conclu¬ I wrote, "If you are
men of industry have
a load of stocks I would sug¬

prefer

of the
presented as
those of the author only.]

comes out on top,
there will be little inclination

July 14,
carrying

Chronicle.

party

Jones is

views

article

here

from

in, but whatever candidate

sions. When

reviewed these matters,

[The

major part

a
action

market

leave

angle.

time

By WALTER WHYTE

The needs and problems

week

un¬

Says—

and

of other free nations will have

Whyte

will

equally to examine the policies of
industry in their effect upon our
position.

doubtedly play

Walter

look at it from

j'S

election

The

future,

others to determine.

Markets

technology.

distance

same

things twice.

Tomorrow's

of the

which

(1055)

do markets discount the

which they

under

conditions

cal

of saying there
be some changes between
and next spring. Seldom

COMMON
STOCK

ated with him in the new firm.

DIVIDEND

NOTICES

Now With Gibbs & Co.
(Special

The

WORCESTER, Mass. —John L.
Brady has joined the
staff of
Gibbs & Co., 507 Main Street. He
was

formerly with Hayden, Stone
'

& Co.

INVESTING COMPANY

CITY

Chronicle)

Financial

NEW

STREET.

BROAD

The

Beard

Directors

ness

company

FRAHER,

ATLANTA,

Philip Morris & Co. Ltd., Inc.

Sept. 11, 1952,

by the
on

Our

Institutional SHARE OWNERS

follows:

($1.00)

The Electric Storage Battery

'•company

NOTICE

Par

per

Value

Share.
Stock

Common

STOCK

quarterly dividends
of $1.00 per share on the 4%
Series and $0,975 per share on
the 3.90% Series have been de¬
clared payable November 1,

Quarterly Dividend of One Dollar
$5.00

CUMULATIVE PREFERRED

The regular

4% Cumulative Preferred Stock
42nd Consecutive Regular

Ga. — Thomas H.
King Merritt &

FINANCIAL

Products

declared

were

Board of Directors

Secretary.

Co.. Inc.

Amino

•

Chemicals

Foods •

Plant

Minerals
★

with

Stafford

Potash •

Dividends

1952.

September 29,

•

Industrial

Joins King Merritt
(Special to The Financial Chronicle)

{

this

Phosphate

4, N. Y.

YORK

September 17, 1952, declared the regular quar¬
terly dividend of $1,375 per share on the out¬
standing
51,/2%
Series
Cumulative
Preferred
Stock of the Company, payable October 1, 1952,
to stockholders of record at the close of busi¬
EDWARD

Mining and Manufacturing

Quarterly Dividend of
Forty Cents (40c) per Share...

"1952

Regular

holders of record at

the close of business on
.

ber

15, 1952.

Octo¬

GENERAL REALTY & UTILITIES

Due

NOTICE

PAYMENT

The

Income Debentures

September

30,

1969

Directors

NO.

Payment of the amount called for by Coupon
16 representing interest for the six months
period ending September 30, 1952 on the abovementioned
Debentures
of
General
Realty
&

dividend of fifty
'

the

Common

No.

Utilities Corporation, will be paid on September
30, 1952. at Bankers Trust Company, Successor
Trustee. 46 Wall Street, New York 15. N. Y.
-

PEAT,my *■ UTILITIES
CORPORATION

GENERAL

September

15,

SAMUEL

M. FOX,

Treasurer

1952.

tember

record

30,
at

($.50)

Vice

President

Resch

and Treasurer

the close of business

tember 15.1952.

H. C. ALLAN,

Secretary and Treasurer
Philadelphia. September 5, /952

Corporation Dividends Are Good Providers
Robert

INTERNATIONAL MINERALS
& CHEMICAL C0RP0RA1 ION

The Church Pension Fund is one of many

insti¬
tutions depending on income from investment
in American free enterprise. It has long shared
in Philip Morris ownership. Corporate dividends
provide a source of income enabling the Fund
to
send regular pension checks to retired
clergymen or their widows. Here Mr. Robert
Worthington, Executive Vice President, is ex¬
plaining the organizational workings of the
Church Pension Fund.

General Offices: 20

North Wacker Drive, Chicago 6

"Y*

COMMON STOCK ($5.00

Sept. 22, 1952.

per

stockholders of
on Sep¬
Checks will be mailed.

1952,

payable Sept. 30,

Checks will he mailed.

share
Stock, payable Sep¬

cents

are

close of business

have declared from the

Accumulated Surplus of the Company

COUPON

dividends

1952, to stockholders of record at the

Quarterly Dividend

CORPORATION
Cumulative

Both

208 th Consecutive

Par)

regular quarterly dividend
$0.75

declared
1952

the

tober

per share has been
payable October 15,

holders

record at

of business on

Oc¬

1, 1952.
L. G. HANSON, Treasurer

September 17, 1952
New

York, N. Y.

The Commercialand Financial Chronicle... Thursday, September 18,1952

(1056)

direct the construction of

should

BUSINESS BUZZ
I

Iron the Nation's

JTjL I wit/

Capital

approved the same under the De¬
fense Production Act since the
start of war in Korea.
Congress
ridiculed "Point IV" 4>ut through

•

"off-shore purchases"*of military
equipment has helped continue
large subsidies to finance, albeit
indirectly, the U. S. exports that
would have been given away un¬
der a really flourishing Point IV.

Am^gJ ^Tgymm

BeWnd-the-Scene Interpretations

M. 1/ w

Peak Due In 1953
^WASHINGTON, D. C.—L'affaire
H'urner, comic and inexplicable,
Hence Mr. Turner should have
teas served one purpose:
It has been well-informed that the offi¬
"groused, perhaps earlier than cial party line of the White House
otherwise, speculation about what is that the peak of defense pro¬
the new Administration to be in¬ duction
will be reached about
stalled next January will do when mid-1953.
He should also have
is faced with the choice be¬ known that the official dogma is
tween a business let-down and that
while
the
peak
will
be
*var.
reached at about that time, there
Hubert C. Turner is the Indiana will be no downswing in defense
•professor who several days ago production but a levelling off, as
•became a member of the Presi¬ the economists put it.
In other

Council

dent's

Economic

Ad¬

along with the trained
Sawyer, Leon H. Keyserling, who is
Chairman,
and
the
universitytrained economist, Dr. John D.
Clark, Vice-Chairman.

visers,

Mr.
4*ress

Turner

sounded

conference

off

reaching its peak defense
Hence, according to

•Production.

•iness reports of his comments, the

•United States in
«rill he faced

the

with

Moscow.

number

for

years,

Fringe Benefits Studied

generation.

defense spending—

present

in this

case

near

the

future

necessity

£or adopting some form of ecotteomic statesmanship to keep the

Hence

raised

■ftal! employment going. [Ed. Note:
GPttll text of Mr. Turner's state-

the figure of Defense

events appears on page

Turner's

Mr.

the

thought

neither Mr. Truman

remarks

that
nor

maybe
the

Mi—And I

De¬

glad to be able to say a few, brief words—"

fense Department or both expect¬

5.]

ed to let defense hit the $5 billiou

Even

though Mr. Turner is a monthly peak. This inference is
#5>ew member of the
CEA, succeed- not justified.
Mr.
Turner has
4«g Roy Blough, who retreated to learned that he was wrong. He is
She United Nations bureaucracy,
very sorry and he is unhappy over
Ehere is no reason why the In- his remarks.
Giana economist should not have
tenown better.

Capital Spending Peak

dent

Harry Truman
for

another

were

four

would be likely that the $5

cease

Presi¬

years

billion

ing

summer

vacations;
and

so on,

vacations,

Christmas

Then the

to help ghost the

<aomic report of the

eco-

President.

This advertisement is not

military establish¬

ment capable of

offer to sell

solicitation

The offering is

made only by the Offering Circular.

These

securities

are

offered

the

and may or may not coincide with
the "Chronicle's" own views.)

Choice

sion, for by the end of 1953 indus¬

Hence

This,

said

speculation

the

Department,

1953

1954

the

—

due.

paper—20 cents.

Some

such

choice

confronted

Harry

Truman in the spring of
Although the CEA advised
the President then that the out¬
1950.
look

was

inflationary,

—

New

assets

The Brookings

sonally

—cloth, $4.00.

higher than he does Mr.

Keyserling, told the President in
the spring of 1950 that the nation's
faced

serious

down¬

ward readjustment.

P. G. and E. of Caiifornia-The

Centennial
and

Investment Dealer

Story of Pacific Gas

Electric

Company

—

Charles

corpo¬

for

rationalize

men

their

are

now on

mo¬

the decline,

new

Adminis¬

any

case

the

President's

schemes to bull the domestic

econ¬

domestic and foreign
short of war had failed.
when both defense production and
Congress laughed at his "Spence
increasing of plant capacity will bill" to provide that government
will

visualize

the

time

omy

on-Hudson,
single

New

copies

quantity prices

York—paperwithout

charge^

request.

new

programs

For

Large Appreciation Potential
WE SUGGEST

RIVERSIDE CEMENT CD.

Price $1.00 per share

°*®

Institution*

Washington 6, D. C.—paper, $2.00

Common Stock

be obtained from

may

1952-1952

by mid-1953, the

tration

Water Products Corp.

United

Policy

advisers

approvals to additions to tives.

capacity
so

Cofweae of the Offering Circular

Problems

Foreign

whom the President regarded per¬

this has been the defense build-up.

Spa-King Mount Clemens

Major
States

By the end of June the Presi¬ M. Coleman—McGraw-Hill Book
they existed on dent had precipitated the seem¬
Company, Inc., New York, N. Y*
Jan. 1, 1946. While dollar values ingly impulsive step of war in
are only crude guides, these fig¬ Korea.
Only the gods and Truman —cloth—$4.50.
ures
do indicate* however, that know whether the advice of a
Shaekles of Gold—Frank Chodbusiness productive capacity has business set-back played any part
been expanded enormously, and in this decision, and Truman has orov —The Foundation for Eco¬
the residual force behind much of probably forgotten, so easy is it nomic Education* Ine;, Irvingtonration

NEW ISSUE

299,000 Shares

latest,
the new Administration
may be confronted with the seriEvolution of Industrial
Rela¬
out possibility that without a new
shot ih the arm for a war pro¬ tions 1922-1952
phamplet of
gram, without a further seeming
selected references — Industrial
necessity to boost defense pro¬
Section, Princeton*
duction and plant capacity goals, Relations
that a business set-back will be University,
Princeton, N. J. —.

business

discouraging the 90% of the dollar value of

Reds from further adventures.

of an offer to buy these securities.

Mr. Truman

Easter out achieving the alleged goal of $124 billion.

vacations, building

building

to ever-new highs.

(This column is intended to re*
fleet the "behind the scene" interpretation from the nation's Capital

will not he try will be faced with a capacity
to produce sufficient both for war
President after next Jan. 20, the
and civilian purposes, and again
whole outlook will have to be ap¬
with the prospect of surpluses and
praised afresh next winter after
and price cuts.
the new President and Congress
Since

Harry Truman. The President

CEA member is

CLASS B (common) STOCK

your

FIRM TRADING MARKETS

the undersigned

leading producer of cement

in fast-growing Southern Calli-

FOREIGN

SECURITIES

fornia.

Analysis of this Company and
a

M. S.WIEN & CO.

PARL MARKS & PP. INC.

Established 1919

EXCHANGE

PLACE, NEW YORK 5, N

Telephone — HAnover 2-87SO

Cable

—

review of the Cement Indus¬

try available

request.

Avttilable around

15;-

FOREIGN SECURITIES SPECIALISTS

Members New York Security Dealers Association
Members National Association
of Securities Dealers

•

the

goal would not be reached until
When this time
comes,
it is
1954. Although some reliable Ad¬
ministration observers still antici¬ reasonable to expect that govern¬
ment officials will fear a depres¬
pate the target being reached in

If Harry Truman were to be
in
1953, it could be
buddy of doubted whether the peak in de¬
•Or. John Steelman, "The Assistant fense
spending would be due in
*o the President," whom Mr. Tru- 1953. The cut-back in rate of ex¬
make known their objectives and
«nan
employs for many jobs, in¬ penditures made earlier this year
attitudes.
cluding that of being an econo- was for the ostensible purpose of
maist.
Regardless of the time when
preventing the defense program
When
the
CEA
submits
its from impinging too harshly upon this goal will be reached, it will
be reached some day unless the
annual
and
semi-annual
"Eco¬ the civilian economy.
nomic Reports" to the President,
scope of the war production pro¬
From the factual viewpoint the
gram is broadened.
41* is Dr. Steelman's job to pick cut was made inevitable
by the
And the peak of the program of
out those things from the CEA inability or unwillingness of the
industrial
facility expansion, is
military to agree upon final de¬
«eport which Truman wants to
now
in sight. The force of the
signs of heavy military equipment.
adopt as his own "Economic Resteamed-up plant expansion pro¬
Such an agreement was an inevit¬
U&ort,"
plus anything else
the able prelude to volume produc¬ gram as a factor in bulling the
economy
can hardly be
under¬
•President may decide to put in tion.
rated. For instance, the Commerce
This
cut-back
also
dhis report.
When Dr. Steelman
gave
the Department estimated that the
Administration the heavy advan¬
4ms been confronted with this
dollar value of corporation capital
job,
tage of continuing to savor a tool assets increased from 1946 (and
tee often called in Robert Turof economic planning which would
with a projection for the balance
«aer who would
journey here dur¬ keep the economy booming with¬ of this year) through 1952 by

ssional ghost of

mew

to be factors

economy

1953.

Due in 1953

"Turner should have known bet¬
ter because he has been the occa¬

Chamber of
Commerce of the U. S., fringe or
hidden payroll costs of 736 com¬
panies it studied, by 1951 had
reached an all-time high average
of $644 per employee. This study,
"Fringe Benefits 1951," is one of
the most penetrating and thor¬
ough inquiries
into non-wage
costs, and may be obtained at a
cost of $1 for four copies by writ¬
ing to the Chamber of Commerce
of the U. S., Washington 6, D. C.
According

certainly

expenditures plus
military procurement for foreign
arms
aid, exclusive of "defense
related"—is running at a monthly
rate of about $4 billion per month.
It is not officially expected to hit
its peak until this figure reaches
$5 billion per month.

toe effect that the United States
awas.

the large number of
spies was seen in the ele¬
vator of the National Press build¬
ing with a new copy of the SearsRoebuck catalogue. He was asked
if he
thought his pals in the
Kremlin were trying to find out
what they could buy with some
good money if they got a hold of
same. He procured the catalogue,
he
confirmed, on orders from
of

Moscow

connection Department

aerith his swearing-in ceremony to

Kremlin Wants Catalogue
One

words, the official line is that de¬
fense spending will be a big prop
under the economy for an unlim¬
ited

industrial capacity, but later

new

50 BROAD STREET...NEW YORK 4, N. Y.

LERNER & CO.
Investment Securities

"MELASA, New York"

TEL. HANOVER 20050...TELETYPE: NY 1-971

10 Post Office Square,
Telephone
HUbbard 2-1990

Boston 9, Mass.
Teletype
BS69

Full text of Commercial and Financial Chronicle : September 18, 1952, Vol. 176, No. 5152

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