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SEP
;
Final
Edition
ESTABLISHED OVER 100 YEARS
24 ^
In 2 Sections-Section
1
©
ommetcial
Reg. U.
Volume
158
Number 4214
New
O NEIL
A. L. M.
.
A. Lee M.
through 15th. Mr. Wiggins succeeds W. L. Hem¬
ingway, president of the Mercantile-Commerce Bank and Trust Company of St. Louis as
bT ° M- w-
and their sub¬
sidiary
com¬
panies and af¬
filiates,
Professor
W
electric
•'
*
and
na¬
Banking and
Randolph Burgess, vice-chairman
-;
SPKAGUE^:X;/S
Finance.
ciation in New York last
Dr.
gas
or
that
Chronicle, which
because
of
space
limitations it is not possible to in-
Graduate
V
School
of
mg*m
Business
securities.
of
Charles
O'Neil
a
could
of
today, and
points
even
direction of the
the
"death sentence."
V"
Thus investors
trust
the
i
of
r
'
!
~
v
e
and
past.V
Discussing events which he be¬
lieves may lead to post-war in¬
flation, Dr. Sprague declared: v
"Unlike
rency
ing the
war
Here
portfolios "will
chasing
doubtless
mand
n-
clude
various
which
the
im¬
pact
of infla¬
O.
M.
if
Sprague
will
inflation
on
security for
par on de¬
for
an
the
greater
goods
and
available
be
quantity
services
for
many
such is¬
than
now
(Continued
and
it may be
on page
1212)
chosen
tion.
R.
Wiggins
treasurer
i; 7 •
W.
R.
of
the
Associa¬
:V-
•
■
The conference of the American
Bankers Association this year had
a
triple theme,
the
domestic
finance and
war
Nov.
1/43
finance
will
be
.
—UNO.
R. H. Johnson & Co.
Rep.
INVESTMENT
REQUEST
25 Broad St.
HAnovcr
2-0600
Teletype NY 1-210
64 Wall
CHICAGO 3, ILL.
135 So. LaSalle St.
SECURITIES
w/lONG and-GOMPANY
'
banking
Annual
meetings of the Associa¬
held
on Sunday, September
(Continued on page 1217)
were
THE
CHASE
State
Troy
I
service with Chase
LOS ANGELES
correspondent
H ardy & Co.
York Stock
facilities
Exchange
York
;
Exchange
Curb
30 Broad St.
Tel. DIgby 4-8400
New York 4
Member Federal Deposit
Tele. NY 1-733
Insurance
Corporation
I
;
:
and
DEALERS
634 SO. SPRING ST.
JERSEY CITY
PHILADELPHIA
Albany
Buffalo
Syracuse
Pittsburgh
Williamsport
Dallas
8770
Teletype CG 1219
War Bonds
Members New
15 EXCHANGE PL.
BANK
OF THE CITY OF NEW YORK
Broaden your customer
Members New
"imrnapfti
Street, New York 5
BOSTON
Actual
BROKERS
post-war
tion's committees and commissions
Wholesaled tsMpufors
HUGH
•INCORPORATED
NEW YORK 4, N.Y.
of
BUY
/
PROSPECTu/oN
Exchange
Exchanges
Geneva
.//;
WAR BONDS
Established 1927
-
BACK THE ATTACK
BOND FUND
-
Members New York Stock
London
Waller
finance.)
found
MANHATTAN
Bay More
1/53
May
to
0.70% to 3.00%
other
and
NATIONAL
M
Hirsch, Lilienthal & Co.
and
J.
v-$m-
inclusive
Yields
problems
economy;
3% Equipment Trust Ctfs.
Series
Wilmer
Burgess
interAmerican fiscal policy; and inter¬
national fiscal policy.
(Reports of
speeches at the meeting by prom¬
inent figures in international and
national
"more
comes,
M.
City elude all in this issue. It is hoped
Bank of New York,
vice-presi¬ that in future issues it -will be
dent.
Wilmer J. Waller, presi¬ possible to
print these also, since
dent
of
the
Hamilton National they likewise constitute a val¬
Bank of
Washington, D. C., was uable contribution to the study of
intense de¬
far
L.
of the board of the National
pur¬
months after the return of peace.
"Patriotic
will
be
restraints
weaker
tion," to take profits
sues
W.
a
at
have
we
power
for
civilian
than
un¬
der
of
contain
redemption
mand.
A.
peribd,
pre-war
government securities issued dur¬
their
whose
i
the
in the expended cur¬
and
demand
deposits * is
widespread throughout the com¬
munity and a large fraction of the
t-
s
tice in the
ownership
Rule
ment
r—
generally than has been the prac¬
7
•>
•
,
Prudent
n
appreciate
Baltimore & Ohio
class
who
issues
1220.
up
ac¬
were
page
hold
other
any
will
operate under
',
fitting, therefore, that investors
(Continued on page 1214)
see
<*>
that, if
market for
He
ed ad-
s
counts
prominent
in the mind of Congress from the
very inception of the Act.
It is
For index
i
v
of
arise
which
in
d
the
bonds
ministrators
none
which
vaguely
A.
Meeting of the American Bankers Asso¬
week.
predicted
comes,
government
better
than
called
"abuses"
Sprague
inflation
may
list
Due
elsewhere in the
regrets
Administration, Harvard University :
session of the War Service
affected"
of
because of the war, are: W.
possibility of a post-war inflation and its after¬
precipitate decline of prices'—was sounded by O. M. W.
Professor of .Banking and Finance,. Graduate School of
Business Administration, Harvard
University, at the Trust Division
adversely
none
this
Sprague,
and
tured
-
the€>
at
math—"a
manufac¬
a
elected
stream-lined
A warning of the
•
of
en¬
tural
by
of
>7.^7"
the interest of
e
officers
meeting,
and
consumers
are
other
r
Investment Policies
holding
comppinies
so
,
P@st-War Tirnst
of
b
head of the ABA.
.
year
securities
ergy
ABA Sessions
in
investors
the
at
Wiggins, president of the Bank of Hartsville, Hartsville, South Carolina,
^ABA
the interest of
War Service Meeting in New York; Other Of¬
elected president of the American Bankers Association at the 69th annual
convention
held in New York City, September 13th
immediately
following, thee>
corner-stone is laid by the statement that "it is hereby declared
that the national public interest,
Copy
was
of the mails and instrumentalities of interstate commerce and
sold to a large number of investors in different States
are
at
ficers and Division Officials Chosen
means
And
Wiggins Elected President
•
widely marketed and distributed by
are
a
69th ANNUAL CONVENTION
The preamble of the Public Utility Act of 1935 starts
by reciting
that "Public-utility holding companies and their
subsidiary companies
,are affected with a national, public interest in that, among other
things, (1) their securities
Price 60 Cents
AMERICAN BANKERS ASSOCIATION HOLDS
Stay In The Execution Of The
Utility Act "Death Sentenced
A.
Office
York, N. Y., Thursday, September 23, 1943
Investors Need A War-Time
By CHARLES
S."Pat.
Trading Markets, always
Idaho Power
by specialists in
Nassau & Suffolk
Over -The - Counter
:
COMMON
Emerson Radio
Lighting Co.
BONDS
&
Securities
Bought—Sold—Quoted
Bull, holden & c°
Kobbe, Gearhart & Co.
^
Members
14 WALL ST., NEW YORK 5. N.Y.
TELEPHONE-RECTOR 2-6300
N.
Y.
Security
45 Nassau Street
Tel.
REctor
Philadelphia
2-3600
Dealers
Ass'n
New York 5
Teletype N. Y. 1-570
TeleDhone-
Enterprise
6MP
Members New
120
York
Stock Exchange
Broadway, New York 5, N. Y
Telephone:
Bell
REctor
ToWvpe
NY
2-7400
1-635
-Analysis upon request
HART SMITH & CO.
REYNOLDS & CO.
INCORPORATED
MEMBERS NEW YORK STOCK EXCHANGE
Preferred
Phonograph
Members
New
York
Security Dealers Assn.
52 WILLIAM ST., N. Y. 5
Bell
New York
HAnover 2-0980
Teletype NY 1-395
Montreal
Toronto
IRA HAUPT & CO.
Members
111
New
York
Broadway
Stock Exchange
REctor 2-3100
Teletype NY 1-1920
Thursday, September 23, 1943
CHRONICLE
COMMERCIAL & FINANCIAL
THE
1190
We
Maintain
R. Hoe & Co.
Common
Mid-Continent Airlines
CANADIAN BANKS
,
York
PI., N.Y. 5 HA
40 Exchange
BELL
Members
Ass'n
BROADWAY
115
2-2772
Telephone
7
;'r 7
BArclay 7-0100
' ;'
York Stock Exchange
St., New York 4, N. Y.
NY 1-1557
HAnover 2-0700
;.7j
■
La.-Birmingham, Ala.wires to our branch offices
1
New Orleans,
BROADWAY, NEW YORK
120
NEW YORK 6, N. Y.
•
/ . Teletype NY .1-672
,
.
York Curb Exchange
New
Members New
25 Broad
:
New York Stock Exchange
and Other Principal Exchanges
Y. Stock Exchange
Members N.
Security Dealers
Steiner, Rouse & Co.
NC tiONNELL & Qo.
j
Established 1920
New
Saltex Looms 6s, 1954
Walworth Pfd.
GOODBODY & Co.
Members
i
..
»
Birmingham Gas.
"C"
Warren Bros. Class "B" &
CANADIAN RAILS
1
Alabama Mills'
;
Remington Arms
^
CANADIAN MINES
Braniff Airways
Cyanamid Pfd.
Botany Pfd. & Common
-
CANADIAN UTILITIES
Appl.
Bendix Home
FUNDS for
Active Markets in U. S.
CANADIAN INDUSTRIALS
Common
American
■
<
'
•Tending Markets in:
Direct
7777 7 Tel. REctor 2-7815
TELETYPE NY 1-423
nEALEits
ise Counsel
Saukers Musi Lend
Hurry! Hurry! Hurry!
If
extra
of
worth
money
and buy your share
Economy Discussed
to¬
day!
By ROBERT
THE ATTACK
BACK
Exchange
Broadway, N. Y. 5, N. Y.
120
Baltiviore Stock
WOrth 2-4230
'
Bell
Teletype N. Y. 1-1227
Interstate Power
6s1952
Taggart Corporation
Preferred
United Cigar Whelan
in
Treasury
current
the
future
in
and
Exchange
all
occa¬
sions advise as
York Curb Exchange
most
Telephone COrtJandt 7-4010
System Teletype NY i-1548
wisest,
the
to
New York 5
Nassau Street
loans, and
on
Vanderhoef & Robinson
Members New
econom¬
ical and safest
Bell
of Georgia, Atlanta,
of
course
W. L.
fi¬
Douglas Shoe
Mhtn. Storage
6s,
& Wfise.
Stock
Capital
Retail
J
selfish in¬
of
terest
Strickland
banking
Common
&
Ga.
tem.
of
In
the midst
post-war
Ser. B.
A
the
sys¬
of a plethora
planning for spend-
means
"With
citizens
our
as
owners
ance
one-third of
and
obligations,
indirect
millions
other
a!s
holders of life insur¬
policies,
of bank
deposits,
tof participa¬
and ownership, it is neces¬
and other evidences
tion
Telephone: WHitehall 3-1223
Bell
1-1843
NY
Teletype
sary," he pointed out, "that there
(Continued on page 1202)
during yesterday's session but
the performance was far from uniform.
The strongest group action
was rendered by the rails, partly on the premise that they had been
temporarily oversold and partly in the expectation of favorable divi¬
dend developments in connection with several members. Events dur¬
ing the day were closely watched in the war spheres and in Wash¬
ington. Some improvement in the<^
the list gained ground
position in the Salerno
American
noted as was
by the Russian
in their remarkably suc¬
district of Italy was
further
forces
Associated
All Issues
>?
impression that accum¬
ulation is continuing in leisurely
fashion in many 'deserving sec¬
tions of the list.. We refer particu¬
cessful drive to date.
Gas & Electric
!
progress
It is our
7 7.
Cities Service Bonds
larly; to those fields in
which post¬
prospects seem outstandingly
bright in view of the pent-up de¬
mand that is being created during
All Issues
war
the War years.
Members N.
37
Y. Security Dealers Assn.
Wall Street, New York 5, N. Y.
Tel.
Bell
HAnover
Teletypes—NY
2-4850
1-1126
&
1127
A recent appraisal
of the outlook
ccrvd
of the building in¬
would
bring years of extraordinary ac¬
tivity and profits to the many cor¬
porations identified with this im¬
portant industry. Building mate¬
rial and household furnishings of
all types would be required and
their prosperity would, if prece¬
dent is followed, spread widely
such
building
Tennessee Prod. Corp.
Scranton
ing
units
of
A.
ard
.
.
program
& Co.
,,7':'7
Inc.
Macfadden Publications,
Associated
Electric
Inc.
-
Ludlow Valve Mfg.
Preferred
Co. Inc.
& Common
p. m., preceded by a
with Larry Denison's
nine.
Free beer will be served to
members and guests during the
and after. Dinner for guests
plate; no
G. A, Saxton & Co., Inc.
WHitehall 4-4970 I
l-xw
Members New York Stock
25 Broad St., New
be
should
rT 4nover
2-0600
ATLANTIC INVESTING
CORPORATION
Exchange
Tele.
NY 1-210
7
6% & 7% Pfd.
:
South Shore
Federal Water
'
Natural Gas
Southwest
Loft
Citizens
Oil
Service
Candy,
Utilities Common
Edward A. Purcell & Co.
Members New York
Stock Exchange
York Curb Exchange
WHitehall 4-8120
65 Broadway
Teletype NY 1-1919
Bell System
Russell, Gillis, Russell & Co.; Ev¬
King, Maynard H. Murch
erett A.
&
Co.;
George
Huberty,
Jr.,
Goodbody & Co., or Harry Gawne,
Merrill, Turben &
Co.
.
*
George L. White Is
With Hicks & Price
to The
4Special
The vast accumula¬
in the hands of our
clearly indicates an abil-,
time history.
tion of savings
the
Results during the
the utilities registered
of
half
67
WALL ST.,
NEW YORK 5,
Telephone—BOwling
Green
this
satisfac¬
the heavy
that must be borne.
In
notwithstanding
load
Financial Chronide)
"
,
ness
outlook,
of
we
the
9-3000
can
see
market's
busi¬
little
major
,
Jefferson Lake Sulphur,
Nu-Enamel
Oklahoma-Texas Trust
Pgh., Canon. & Washington.
1st 5s,
movements one
should not lose sight of the broader
market picture.—J. S. Bache & Co.
(Sept. 16-17).
1937
U. S. Radiator, Pfd.
Washington & Canonsburg
1st 5s,
Naturally, inter¬
phase, but during the progress
Pfd. & Com.
Kentucky Fuel Gas 6JAs 1942
1932
York Corrugating
ruptions will occur intermittently
such as the mid-summer reaction¬
ary
ILL.
CHICAGO,
White has become
prospect and in con¬
sideration of the longer-term
of such corrective
N. Y.
seem
year
likely to . continue^ quite
trend changing.
York 4, N. Y.
England P. S. Plain
New
Members New
the
party
made with James N.
for
Reservations
danger
Bought—Sold—Quoted
NY
Fri¬
on
game •
tax
Prior Preferred
SIMONS, UNBURN & CO.
5
;
party of the
be held
will
view of this
W. L DOUGLAS SHOE CO.
'
1915
Street, New York
Telephone DIgby 4-7900
Bell System Teletype NY 1-1790
Pine
7:30
at
ball
tory
& Common
Inc.
Preferred
Established
30
•
day, Oct. 1, at the University Club.
3313 Euclid Avenue.
Dinner will
second
Preferred
,
Teletype
7v7/.
The annual election
Association
be
Robert C. Mayer & Co., Inc.
— George
L.
associated with
citizens
Hicks & Price, 231 South La Salle
ity to satisfy demands -that are Street; members of the New York
now being built up in these direc¬
and
Chicago
Stock Exchanges.
tions.
Mr. White was formerly head of
Major movements naturally re¬ George L. White & Co., Chicago
through the national economy.- v. quire more than incidental news investment firm.
Another highly important peace for sustenance. Fundamental fac¬
beneficiary promises to be the tors remain in our opinion con¬
automobile industry.
It has been structive. Thanks to an expansion
American Fuel & Power 7s 1934
estimated that this field may en¬ in volume, industry profits for the
joy five years of record produc¬ first half of this year recorded
Columbia Baking, Pfd. & Com.
tion. Automobile and truck man¬ gains both before and after taxes.
Galveston-Houstcn Co.
ufacturers would- be outstanding Of the three major groups, the
Common
Gas
170 PINE ST., N. Y. S
...
Gottron, Gillis,
smallest gain.
,
Spg. Brook W.S. Pfd.
Secretary,
Co.;
while
Associated
Pfd.
Ohio Match
for build¬
approximately one
beneficiaries
with. innumerable railroads recorded the largest im¬
million units a year for the decade
accessory
concerns enjoying the provement after taxes, the indus¬
following the war's end. It is ob¬
vious that the fulfillment of any largest business in their peace- trials the next sizable expansion,
dustry forecasts a need
Pfd.
Spokane Int'l Ry. Esc. Recpts.
charge for members.
New York 5
20 Pine Street,
Deep Rock Oil Corp.
will be three dollars per
H. G. 8RUNS & CO.
Teletype NY 1-2361
*
REctor 2-7634
Interstate Bakeries,
Russell &
Walter J. Carey,
Robbins, Gunn & Co.; Treasurer,
direct owners of Arthur
V.
Grace,
Cunningham
than
more
Broadway, N. Y. 5, N. Y.
120
'
game
On balance,
"
.
>
Pfd.
5%
SHEETS"
C. E. de Willers A Co.
.
Seiberling Rubber
Class
LISTINGS
IN "THE
a
Properties
1959,
SEE OUR
Asso-
Industrials
77
over
$300,000,000,000,
in future American life. V
of
peak
countless
regard to
any
Robert
create
to
government
out
Stock
Preferred
Prior
Cleveland Security Traders
sound eco¬ .7
:
Cor win L. Liston
.
7:7,7
•
.'•••.
;V; v..7"
and that they
must
aid in
bringing home to cialion for the 1943-44 term, the
every American
an understand¬ following candidates were elected:
ing
of what
the future ; debt, President, Corwin L. Liston, Preswhich he estimated will reach a cott & Co.; Vice-President, Rich¬
counsel
pursued, with¬
Amer. Gas & Power
Rails and
Longdon, Chairman of the elec¬
tion committee, announces at the
annual election of officers of the
nomic atmosphere,
nancing to be
Common
L.
Association not only has a greater
responsibility for the successful financing of the war than any. other
single group in private enterprise," was the statement made,.by
Robert Strickland, President of the Trust Co. of Georgia, Atlanta,
Ga., at the Association's War Service meeting.
"It has," he said,
"a larger duty to assume the initiative in devising a long-range fiscal
policy for both the war and post- ■»
1
:——:
ing and borrowing its . authorita¬
war period in order to assure our
tive
voice must be t raised for
continuing - national
solvency."
earning, saving and paying." If
"Pursuant to this responsibility,"
Mr. 7, Brand the United States cannot plan for
went on
to the preservation and solvency of
it
say,
"it must its own post-war economy,
cannot pretend to assume the sal¬
give
unre¬
stricted
sup¬ vation of the world." : He urged
bankers
must
give wise
port to the that
war
31
>
L.
—
American Bankers
the
Preferred
♦Traded on N. Y. Curb
j
OHIO
CLEVELAND,
STRICKLAND
President of Trust Company
"That
Mitchell & Company
Members
Our,
Financing and Its Effect On
Government War
you—dig: up that
extrsf, mind
Economy
ar
bought $100
War Bonds—
haven't
you
Actual Markets in
Announce Annual Party
T. J.
FEIBLEMAN & CO,
Members
New
41 Broad
Orleans Stock Exchange
Street
BOwling Green
.
9-4433
New York 4
Tele. NY 1-493
Volume 158
The
Number 4214
Reg.
U.
William
CHRONICLE
S.
B.
Patent
Dana
Amer. Gas & Power
Office
Company
Publishers
BEekman
D.
Seibert,
Riggs,
Manager
Thursday, Sept. 23, 1943
every
news
advertising
Chicago—In charge of
Fred H. Gray. Western Representative,
Field Building (Telephone State
0613).
London—Edwards & Smith, 1 Drapers'
Gardens, London, E.C.
Copyright
1943
by
William
B.
Dana
-v:
■
-■
Canada,
Central
Cuba,
$27.50
per
America,
$29.50 per
South
year;
and
Spain,
Mexico
and
Great Britain,
year;
Continental Europe (except
Spain), Asia,
Australia and Africa, $31.00
per year.
Other
Compendium—
.$20 yr.
Semi-Annual
..........
.......
NOTE—On account of the fluctuations
in the rate of
exchange, remittances for
foreign subscriptions and advertisements
must
be
made
in
New
York
funds.
Dlgbjr 4-8640
BONDS
Wm. Cc
York
St., N. Y. 5
Bell
Stock
Exchange
Teletype
NY
of
W.
A.
John
C.
Roney
&
they
and
C.
the
past
G.
this
he
&
Co/ and
Co.
the
PHILADELPHIA,
we
the past
of
Frankly,
phia.
the
-
Forming Wm. Fisher & Co.
William Fisher & Co., members
of the New York Stock
Broadway,
1.
New
Exchange,
York
City,
on
Partners will be William
Exchange
and research departments.
Hemingway
members,
doing business
not
that
"the
more
OTHER
who
as
be
Textile
further
have
individual
our
.
.
.
Y1'
Latin-American
Analysis
our
Request
J.F.Reilly&Co.
Members
New
Ill
present in
York
Security
.
Dealers
Assn.
Broadway, New York, N. Y.
REctor 2-5288
Bell
System Teletype,
Y.
N.
1-2480
our
Gisholt Machine Co.
relations with
on page
1206)
Stromberg-Carlson
Haloid Co.
Memoranda
precipitated by the fall
was
nearly
so
from
soon
as
business
standpoint. "
For the purpose of this
we will assume that
sion
is
practically
close
as
it
as
.
>
discus¬
victory
was
in
forward strongly, this
movement
(Continued
by
on page
*
'
"■ *
•'
-
UlRWb&loM
*
170 Broadway
Bell System
Boston Traders To
1216)
'. V
COrtlandt 7-6190
Teletype NY 1-84
Hold Annual Meeting
BOSTON, MASS.—The Boston
Securities Traders Association will
Commonwealth Gas
6s, 1948 and Common
Great American Industries
University Club, 40 Trinity Place,
on
Tuesday, September 28th, at
5 p.m.
Checks to
cover
Tybor Stores Common j
the charge
of $1.75 should be mailed
promptly
to the Treasurer.
Broadway Barclay 2s, 1956
The committee in charge of the
annual meeting are: G. Carlton
Harriman
•
mar¬
having been
a brief and
particularly severe drop im-
,
Request
Bartgis Brothers
hold their annual meeting at the
In the spring of that
year it became apparent that vic¬
tory for the Allies was in sight.
During the balance of 1918 and
only
1
peace^
inclined
the
on
an
Jordan, R. W. Pressprich & Co.,
Chairman; Harry O. Baker, Boston
Safe Deposit & Trust Co.; Paul
Monroe, Hunnewell & Co.; Lester
Doucet, Salomon Bros. & Hutzler,
and James J.
Building Es, 1951
Frank C. Masterson & Co.
Members
New
64 WALL
ST.
York
Curb
Exchange
NEW
Teletype NY 1-1140
YORK
5
HAnover 2r9470
Lynch, Shea & Co.
dual
Transfer Agent in New
Panama Coca-Cola
r
Back The Attack
acceptable to the New York
Exchange and other Exchanges.
$1
Payable
Total
/BUY WAR BONDS
for Our Booklet
WATER WORKS
dividend
Oct. 15th to holders
record Sept. 30th
SECURITIES
of
Bonds
to
year
date—$4.50
Preferred Stocks
Approximate selling price 38
Ifogtotntr mth 0rmtsfrr (Company
ESTABLISHED
1899
Inquiries Invited
C. E.
Unterberg & Co.
Members New York Security Dealers
15
on
from' the * begin¬
But under the present
(Continued
'
fear is that
optimistically
itarian;. but
not
SAVINGS
advantages in
our
believe,.: but, whether it comes
or later, it should be wel¬
comed .not only from the human¬
punctuated
TAX
1
those of destruction that sound securi¬
on
almost all of 1919 the stock
Jersey City, New Jersey, which
were
"fear" of
sooner
upward
TRANSFER
New York 6
ning,
currency
rather than
come
ket moved
2 Rector Street
for
administration those irritants th&t
Fisher, both early 1918.
floor brokers.
Call
L.
Mussolini represented
will
been
arrangement is
W.
He,
ties values must be built.
connected with Van
was
New York City, in their statistical
Stock
to
sistenL; pattern
in cir¬
If the recent market sell-off which
Alstyne, Noel & Co. in Philadel¬
Fisher and Warren E.
York and in
there
can
war
Dictaphone Corp.
Mr. Carroll in
&
as
the
construction
Department.
With Ward & Co., 120 Broadway,
You will find
excuse
Bond
Oct.
•
Consolidated
in
as
delity-Philadelphia Trust Build¬
as Manager of the Municipal
York, and Hall, Cherry, Wheeler
arrangement
billions
early peace, that fear seems
wholly illogical.
Both logic and the pattern of World War I indi¬
cate that peace is bullish, not bearish, and that it is on the forces of
will be formed with offices at 120
AND
56
Peace Is Bullish
Co., Fi¬
Thomas J. Doyle, formerly con¬
nected with Hughes & Treat, New
STOCK
de¬
relations; he observed that "gen¬
erally speaking, our foreign pol¬
icy has followed a rather cart*
PA.—Arthur
-—•MB*"—
associated
referred
outstanding exceeds 18 billions of
ing,
now
"bank
report
as
President
in
three
parts,
Mr.
Hemingway in his second portion
that
out
that
State and Municipal."
In
submitting his
need more
pointed
Y.
1-1203
year
are more than 88 bil¬
against
after
Teletype NY
our
Presenting the question
"what
.
needed after the war, let them be
provided by local governments—
one
culation."
with headquarters in Atlanta, Ga.,
in
the
Citizens
and
Southern
Co., Buffalo, is
so
"no
'
/
Security Dealers Assn,
Broadway, New York 6, N.
spending to make
put money in the hands
of the people."
Mr. Hemingway
advised that "if public works are
argue suc¬
money
;;
,
INC.
Members New York
Government
during
cessfully
Detroit
*was
L. J. GOLDWATER & CO
work and
remarked
that
In
of
Avery & Co. ;
that
true,"
added, "it
,
trading department for Marquardt,
&
to
then
be
way
as
1929."
ency."
•
"Among
other -things,
Mr.
Heming¬
A.
W. Carroll has become associated
with Hemphill, Noyes &
Now With Ward & Co.
to
be
said
posits today
our
Information
less than 5 billions.
was
further
lions
the
only
Co., Penobscot
manager
He
the emerg¬
can
was
of 1929 it
are
meet
associated
McDonald
he
on
emergency."
to The Financial Chronicle)
become
the
the
to
powers
necessary
should
MICH.—Edward
beginning of
authority of
very
"re-^v
practically' dollars, whereas in the boom
seen
given
Department
that
ground
Building. Mr. Nadeau was previ¬
ously with Bliss Bowman & Co.
announce
Doyle Is
have
we
"Granted
has
Louis, noted that "from the
Executive
and
appointment of Ben A. Ru¬
dolph as Southern representative
Thomas J.
of St.
unlimited
Wm.
Rudolph Represents Arthur Carroll With
Lord, Abbett In South
Lord, Abbett & Co., Inc., 63 Wall Hemphill, Noyes & Co.
Building.
Mr. Rudolph was for¬
merly associated with Johnson,
Lane, Space & Co., Inc., of At¬
lanta.
.'\Y:'
QUOTED
-
Statistical
HAnover 2-8970
cently
B.
the
SOLD
-
Complete
39
national life restrictions have been
placed about the
electeo. officials," but that
are:
Wm. C. Roney, Clyde L.
Hagerman, J. Edward Roney, An¬
drew C. Reid, general
partners,
manager for
Street,' New1 York City,
4-6551
of ALL COMPANIES and
Trust Co.
as
Co.
Wilson
1-2033
WHitehall
meeting of the American Bankers' Association.
Mr.
Hemingway, who is President of the Mercantile-Commerce Bank &
Lein & Co.
Partners
"The necessity for the abolition of
paternalism in Government"
stressed by W. L.
Hemingway, in his address as President at the
War ^Service
Sept. 30, when Wm. C. Roney
acquires the Exchange member¬
ship of John P. Lein of John P.
with J. S. Bache &
WHitehall 4-6330
Street, New York
BOUGHT
was
of
un¬
bonds.
REAL ESTATE SECURITIES
DETROIT, MICH.—Wm. C. Ro¬
& Co., Buhl Building, mem¬
bers;, of the Detroit Stock Ex¬
change, will become members of
DETROIT,
Exchange
Wall
and
bids
or
CERTIFICATES
By W. L. HEMINGWAY
ney
Nadeau
JJewburger, Loeb & Co.
stocks
good
traded
TITLE Co.
Retiring President American Bankers Association and President of
Mercantile-Commerce Bank & Trust Co., St, Louis, Mo.
(Special
CORP.
for
us
rarely
Telephone:
To Be NYSE Members
Bache Co. lei Detroit
Bought—Sold—Quoted
40 Wall
Roney & Co.
to
many
99
Teletype NY 1-5
v
Development of Trade with Latin America Urged
-
PRUDENCE
New
r;
Should Be Abolished
Teletype -CO 129
Edward Nadeau With
CORP.
SECURITIES
or.
come
known
Members New York Stock
Exchange
Harrison 2075
COMPANY
PRUDENCE
Members
'
Teletype NY 1-832, 834
& Co.
-
Joseph L.
Hickey (trustee), special partners.;
Issues
PRUDENCE
CHICAGO 4
—to
Paternalism In Government
Board of Trade Bldg.
NEW YORK 4
and
All
Telephone HAnover 2-4300
Security Dealers Ass'n
the New York Stock
Publications
Bank and Quotation Record—Mth.
$20 yr.
Monthly Earnings Record—Mth.. .$20 yr.
State & Municipal
<
York
"OBSOLETELY"
■
Subscriptions in United States and
Possessions, $26.00 per year; in Dominion
of
New
Broadway
IT'S
Company
Reentered as second-class matter Feb¬
ruary 25, 1942, at the post office at New
York, N. Y„ under the Act of March
3, 1879.
32
Utility and Industrial
25 Broad Street. New York
STRAUSS BROS.
Offices:
AND COMPANY
Spencer Trask
•>
Members
Other
llCHTEIMin
B. S.
NECESSARY
Cons. Elec. & Gas
issue)
and every Monday
(complete statistical issue—market quo¬
tation
records,
corporation,' banking,
clearings, state and city news, etc.)
offerings of
PREFERRED STOCKS
Amer. Util. Serv.
week
a
Thursday
and
Public
Northern Utilities
President
Business
Published twice
(general
1191
High Grade
Kentucky Utilities
Editor and Publisher
Dana
interested in
are
3-3341
Herbert Di Seibert,
William
We
Assoc. Gas & Elec.
>
Spruce Street, New York 8
William
FINANCIAL CHRONICLE
COMMERCIAL and
FINANCIAL
25
THE COMMERCIAL
Exchange Place
Jersey City 2, N, J.
61
:
Assn.1
Broadway, New York 0, N. Y^
Telephone BOwling Green
Teletype NY f-1666
9-3565"
HoixRsseSTrqster
'
•
Established
Members N.
74
Y.
1914
Security Dealers Assn.
Trinity Place, New York 6, N. Y.
Telephone;
BOwling
Green
Teletype'.
9-7400
.
NY
1-375
CRAIGMYLE, PINNEY & CO.
Members
ONE
New
WALL
York
Stock
Exchqngt
STREET, NEW
Telephone
WHitehall
YORK S
4-5290
COMMERCIAL & FINANCIAL
THE
1192
Thursday, September 23, 1943
CHRONICLE
NEWARK
i
WARREN BROS. CO.
w
New
We
pleased; to announce that
are
Class "B" and MC"
Municipal
Mr. Ben A. Rudoijpii
Bought Sold Quoted
115
Southern Wholesale
Principal Exchanges
105 WEST ADAMS ST.
CHICAGO
•
:
NEW YORK
Bonds
as
J. S. Rippel & Co.
with offices at
Established
ISS&SfeNS
ATLANTA
1891
Newark 2, N. J.
MArket
3-3430
' Vi I
18 Clinton St.,
Building
817 Citizens & Southern
TELETYPE NY 1-672
BARCLAY 7-0100
us
Representative
Exchange and Other
BROADWAY
TELEPHONE
associated with
become
has
f |
Goodbody & Co.
Members N. Y. Stock
Jersey
Phone—REctor 2-4383
New York
PHILADELPHIA
We
become
'
TRADING
MARKETS
INCORPORATED
of our
associated with us as manager
63 Wall Street, New York ;
;
CHICAGO
Sales Department
^v::
Lord, Abbett & Co.
MacBOYLE LEWIS
MR.
has
in announcing that
take pleasure
;
Liberty Aircraft
-
Products
EOS ANGELES
JERSEY CITY
>
....
,
.
;
COMMON
September i6\ 1943
,
Memo,
cruttenden & co.
Stock Exchange
Stock Exchange
Members New York
Telephone
and Chicago
Direct Private
South La Salle Street
209
Teletype
Chicago 35
Dollars-A Study Of The Future
Of The Pacific Coast And Its Securities
'Go West Young
Wires to-
;■
Dearborn 0500
East
and
West Coasts
Chicago 4, Illinois
speculation
as to what extent the migration of aircraft and shipyard workers to
the West will be permanent and what will be done with the heavy
plant expansion accomplished in that area.
In view of the great
interest in this question, E. F. Hutton & Company, 61 Broadway,
New York City, members of the New York Stock Exchange and
There
PUBLIC
SYLVANIA
INDUSTRIAL
INDUSTRIAL
N.
Members
MUNICIPAL
BONDS
74
Security Dealers Ass'n
Y.
HA 2-2400
Trinity Place, N. Y. 6
agalixnawCOMESNY
INCORPORATED
Teletype NY 1-376-377
Private
Detroit
/
.
'
Vr; CHICAGO
Buffalo - Cleveland
Pittsburgh - St. Louis
Wires
Exchanges, has pre-,tw
attractive booklet en¬ vestor standpoint is not without
titled "Go West Young Dollars," significance, E. F. Hutton & Co.,
declares.
It
is
a
development
designed to acquaint investors in
the East with the situation on the tending to provide maturity and
seasoning
for
existing
invest¬
Pacific Coast.
The prospects for industrial de¬ ments, yet at the same time re¬
velopments after the war offer taining all the appeal to risk
exciting possibilities.
New and capital inherent in the . growth
basic key industries—aluminum, prospects of a virile and expand¬
pared
Troster,Currie& Summers
to
New York
considerable public discussion and
been
steel
The War Production
in the Far West.
The
necessity of the West supplying a
Trader-Order Clerk
Street & Foreign
with mem¬
ber firm having trading organi¬
zation with a viewpoint toward
'Since 1893*
the
Box S 22,
LOS ANGELES
NEW YORK
future
of
Exchange
Commercial & Finan¬
Spruce Street,
York 8, N. Y.
New
agricultural and natural resource
products, is by virtue of its rapid
industrialization gaining a
balance
that from a long term in-
of
that State
industrial
[
as
Fulbright
House Adopts
Office Space
(approx.
18,000)
in highly reputable old estab¬
lished Paint Company.
Plant
and 1 head
office
Pittsburgh.
Manufacturing well-known prod¬
ucts
having wide present and
post-war market potentialities.
Plant capacity permits doubling
present yearly sales approach¬
ing $1,000,000. Owner desires
10,000 out of total of
to
Available
in LONDON
shares
Controlling
On the
the
"spot"-in the centre of
Stock
Exchange, Financial,
Banking and Insurance
the City
Offices
fice,
let at $1,250
Letters
num.
1
area
of
of London—furnished
to
to
Drapers
per
Chronicle
Gardens,
an¬
Of¬
Lon¬
don, E. C. 2.
one
Real opportunity for any
prepared to invest approxi¬
mately $200,000.
The
Commercial
Chronicle,
25
Box W 15,
&
Financial
Spruce St., New
York, N. Y.
Ins. Stock Attractive
The
ciirrent
situation
in
Rock Island Interesting
Raymond & Co., 148 State St.,
Boston, Mass., have prepared an
interesting discussion of the reor¬
ganization plan proposed for the
Rock Island with particular refer¬
ence to this railroad's general 4s
of 1988 and the first refunding 4s
of 1934.
the
and
NORTHWEST
SECURITIES
Investment
Tenth
emerg¬
one
Teletype
\
Securities
Floor, Porter Bldg.
D. 90
P.
PORTLAND, OREGON
ST. LOUIS
Associated Electric
of this interesting bro-
Copies
MO Criticized By
Company
4l/2& & 5t
the first expression
of Con¬
gressional sentiment on foreign
policy after victory, the House
adopted on Sept. 21, by a vote of
360 to 29, the Fulbright resolu¬
participation by the
tion favoring
national
The
in post-war
States
United
peace
measure
machinery.
now
goes
Senate, where it will
ered
by the Foreign
Committee
other
The
eign
be consid¬
Relations
resolutions.
of its for¬
prerogatives,
relations
Copies of this memoran¬
dum may be had upon request.
by
Senate Foreign
the
Committee
Roberts,'
is
Staff
the United
The
Relation
V.
Correspondent of
says
Edward
Representative
sponsored
by
Fulbright (D.
Ark.) reads as follows:
"Resolved
by
the
House
of
'eltason, Tenenbaum, Inc.
Britain
are
803
Landreth
Bldg.
ST. LOUIS 2,
MO.
L. D. 240
Teletype—-SL 486
trying
leading voice in the
said a
Mos¬
Sept. 19, which added:
commercial
and
groups,"
x5r/x §c
United Press dispatch from
cow
on
the
Allies' administration of territory
captured from the Axis that has
been printed this month by the
publication which in the past fre¬
quently has mirrored the attitude
It
was
the second atiack on
Soviet Government.
and the Working
Co.
SAINT LOUIS
509 OLIVE ST.
Bel!
System Teletype—SL 80
Members St. Louis
Stock Exchange
Class"
charged that the A. M. G. in
Press.
resolution,
Government
Occupied
to obtain a
settlement of
European economic problems for
to the
"Anglo-Saxon banking, industrial
inter¬
together with several
Senate, jealous
Bought—Sold—Quoted
Territory and the
American Board of Economic Ac¬
tion were criticized by the Soviet
trade union publication "War and
the Working Class" on Sept. 19.
The publication also contends that
the
United
States
and
Great
of
likely to sidetrack the proposal
pending drafting of a substitute
retire from all business a<itiv-
itbs.1
the
Russian Publication
Bill For U. S. Post¬
In
Opportunity
PORTLAND
areas
The Allied Military
Post War
PH 265
N. Y. DI 4-1527
PORTLAND, ORE.
chure may be obtained from E. F.
1 Hutton & Company, upon request.
war Collaboration
Exceptional
—
foreign business.
cial Chronicle, 25
Members Los Angeles Stock
to
largely dependent upon trial leadership.
so
cause
Contracts
Interested in position
Wyeth & Co.
points
leading
ence
Philadelphia 2, Pa.
RIT 4488
Phila.
Board has
of the
in the
he war.'
r>; V:
post-war era, ranking with Texas,
The economy of the Western Ohio and Indiana as among those
States, lopsided in the past be¬ states headed for post-war indus¬
been
Arbitrageur
f
Secufritiel
California
and then expanding it, has
brought into sharp relief by
ket,
St.,
Bell Teletype
reported that the increasing con¬
centration of major industries in
greater share of its own mar¬
far
Pacific Qoait
1529 Walnut
Camp & Co., Inc.
ing country.
post-war
facilitate
will
—
rubber,
synthetic
magnesium,
Milwaukee
Boston
Philadelphia Stock Exchange
Members New York Stock Exchange
an
progress
>
BUCKLEY BROTHERS
Members
other leading
RAILROAD
|
CORP.
UTILITY
has
Request
on
Sicily
of the
"War
governmental Stock Transfer Tax
and that it "is generally And Other
Savings
retained the Fascist
machine
developing from foundations
have
nothing
in
common
that
with
and Transfer Com¬
Two Rector Street, New
City,
and
15 Exchange
Registrar
pany,
Representatives (the Senate con¬ democratic principles."
York
Place,
curring)■, That, the Congress
The magazine expressed concern
Jersey City, N. J., have
prepared an interesting booklet
New York, whose
hereby expresses itself as favor¬
Elected Directors
over "indications"
that A. M. G. on the advantage of their dual
capital stock is selling in an at¬
of appropriate
Ben Abrams, President of Em¬ ing the creation
tractive low-price
does not intend to limit itself to arrangement as transfer agent in
range, offers
international
machinery
with
New York and Jersey City, which
interesting possibilities according erson Radio & Phonograph Corp.,
military administrative problems
to a circular being distributed by announced that Ferdinand Eber- power adequate to establish and
arrangement is acceptable to the
that may arise during the trans¬
New York Stock Exchange and
Butlef-Huff & Co. of California, stadt of F. Eberstadt & Co., and to maintain a just and lasting
itional period between the liber¬ other Exchanges.
Richard C. Hunt of Chadbourne,
Copies of the
210
West
Seventh
Street, Los
peace, among the nations of the
ation of Axis-held countries and booklet will be sent by Registrar
Angeles, Calif. Copies of the circu¬ Hunt, Jaeckel & Brown, have been
world, and as favoring participa¬
elected as directors of Emerson.
and Transfer Company upon re¬
lar, discussing the situation in de¬
the reestablishment of local gov¬
tion by the United States therein,
tail may be had upon request from Charles Robbins has been elected
quest.
; i
ernment.
Vice-President.
through constitutional processes."
Butler-Huff & Co.
Baltimore
Company
American
Insurance
of
Volume 158
Number 4214
THE COMMERCIAL & FINANCIAL CHRONICLE
1193
^
i
i
i
Denver & Rio Grande
Bond Brokers
Cons. 4s, 1936
Circular
1
vilas & hickey
on
request
CANADIAN BANK STOCKS
!
;
:
Members
New
York, Stock
49 Wall Street
Exchange
pflugfelder, bampton & rust
New York 5, N. Y.
'
.
'
.
Telephone: IIAnover 2-7900
61
Teletype: NY 1-911
Members New York Stock Exchange,
i
,
'
Broadway
•.
r;'
,'Cv
Administration
opposition to revision of the War Contract Heto give industry specified profits after taxes for
post-war reconversion reserves was voiced before the House Ways
negotiation Act
so as
and
Means Committee en Sept. 10 by Secretary of Commerce Jesse
H. Jones and Randolph Paul, General. Counsel of the
Treasury;
Mr. Jones said the price adjustment statute is not
tj^e place to
.
provide
for
industry
with reserves^
reconversion
and as much an element of
post-war
peacetime production.
I
Mr.
'•
Paul estimated
ration
profits
>1943
for
would
that corpo¬
1941,
be
material
;
Sept. 10 stated:
Mr.
Paul
:
^'•
.
estimated
He said it
American
to
corporations still would hold $11,600,000,000
in
cash
or
added
investments after paying $12,600,-
pre-war
periods
The
but
the
Paul
Mr.
tentions that price adjustment is
"excessive
contractors who got
necessary to recapture
Government
business
without
competitive bidding.
■
To
sibility of
sidered
a
manner
to
for post-war recon¬
peace-time produc¬
and
'
Situation
were renego¬
that basis, "the Govern-
vised
plan of the
focus
attention
Paul gave them a similar view.
Representative
Knutson
like taxes
me
said:
are
Denver
This
from the firm upon
request.
just
on
the
fact
Mortgage Bonds
Guaranteed
and
Serial
Special
Stocks
Obligations
of
to pay
off the whole
INCORPORATED
-i
123
'
Teletype
PH
296
and
\
*
'
™
297
-
other system obligations.
quest *
-approved
was
weekend
others
and
recommend
the
120
Broadway
YORK
Thoughts
on
War
Bonds
Post-War Prospects
on
request
Members New York Stock
TEL.
Exchange
WALL
NEW
HANOVER
2-1355
.
-
/
STREET, NEW YORK 5
3-3450
Teletype: NY 1-2050
HART SMITH & CO.
52
WILLIAM
Bell
This
to
react
the
to
(in reorganization)
r;
may
filed
compromise
by
institutional
bondholders in July.
-This pro¬
posal also contemplates large cash
payments,
and
*
was
brought for¬
dition to these proposals already
pending, the Seaboard reorganiza¬
tion is finally showing signs of
on
in October, and Judge Hincks in
adjourning the New Haven hear¬
ings to October 5 urged all parties
come
to
agreement
on
the
I. C. C. plan by that date. He made
it
plain that if objections are
waived he stands ready to approve
the plan in short order. All in all,
is
growing evidence of the
2-0980
Montreal
Toronto
v
Minneapolis & St. Louis 6s 1932
Minneapolis & St. Louis 5s 1934
Minneapolis & St. Louis 4s
SEABOARD Alt LINE
RAILWAY COMPANY
1949
Minneapolis & St. Louis 5s 1962
Iowa Central 5s
1938
Iowa
1951
Des
Central 4s
Moines
Fort
&
Specializing in
Dodge 4s 1935
Underlying Mortgage
Frederic H. Hatch & Co.
and
Incorporated
Wall
63
Street
Bell
New York
Leased Line Issues
5, N. Y.
Teletype NY 1-897
Van Tuyl & Abbe
anxiety of all parties to reorgani¬
zation
proceedings to get these
properties out of the courts with¬
the
out
interminable
72 WALL STREET
'
"i
NEW YORK 5
*
delays that
have become characteristic.
The
roads
large cash balances of the
affords
an
opportunity for
Rock Island
improving the status of the vari¬
bondholders groups, and if the
of this cash is to be sanc¬
ous
use
tioned by the
tral by the senior bondholders.
IIAnover
Teletype NY* 1-395
ST. LOUIS RAILROAD
the
over
St., N. Y. 5
New York
MINNEAPOLIS &
re¬
the
authorities, feasible
compromises
and
lengthy litigation
readily workable.
the
recent
appreciation
organization
mission
value
is
of
It
seems
that
particular
•
reference
.•.' • •/;■.:*
General 4s, '88
v•'
1st
become more
The courts in
a
solution of
problems
Copy
Refunding
sent
4s,
upon
•
to
i
'34
request
it
as
fully
utilization
too
of
aware
of
the
cash
of
optimistic
to
the
148 State St.,
Tel.
CAP.
0425
:
Boston, Mass.
:
Teletype BS;259
^^JY^YjTelepfi^^
;•
to
as¬
in
the
the recent turn
market indicates any future in¬
vulnerability to periodic waves of
peace psychology.
Nevertheless,
(Continued
on page
I
,v
Albany &'
it does appear reasonable to view
r
the
•';)'.• *'■
re¬
and
bring-about satisfaction
warring factions.
sume
/•';
'
to
be known if the Com¬
soon
with
■'
past have shown an
of the potentialities
inherent in such
should
end
an
Discussion of the Reorganization Plan
1218)
We believe that the recent hearing, at which it was re¬
quested of the Court to retire the Receivers' Certificates
and other
Railroad:
outstanding bonds, of the
SEABOARD AIR LINE RAILWAY
makes
.
STREET
3y2», 1956, 1963, 1973
COi
more
pertinent than ever our brief study on the
in which we attempt to analyze the result of
on various
outstanding issues.
such action
Mclaughlin, baird & reuss
ONE
Montreal Lt. & Power
or part
Frisco has pending a petition to
make interest payments and also
subject
Circular
5%, 1968
Susquehanna
of
RAILROADS
Some
':j
Paper
•
9
NEW
purchase
WALL
1
WHitehaU
have
been Settled between the writing
of this column and its publication.
settle
4%.,1960
AA of N. F.
Reg.
or
various
there
We
y;''.,
EROY A, STRASBURGER &
underlying bonds and
for payment of back interest on
to
South Broad Street
PHILADELPHIA
Canadian Pacific Ry.
::
Bought—Sold—Quoted
pending its application for author¬
ity to use a part of its cash bal¬
Septem¬
ber 20 and arguments to be heard
STROUD & CO.
all issues
Int'l Power &
Cpn.
there are a number of important
reorganization developments that
may come to a head in the near
future..'- The Missouri Pacific had
life, with briefs filed
;
YVA.
Internals
Gen. 4s, 1988
;
that
of; these developments or
potential developments are e xpected to have an important in¬
fluence on expediting the entire
reorganization procedure. In ad¬
Equipment Trust Certificates
-
to
All
Railroad Se&urities
'/
k
& Pacific
Rio
&
tended
Seligman, Lubetkin & Co., Inc., ward as a means of meeting the
Broad Street, New York
City, question of "qualitative and quanhave prepared a new
descriptive titave compensation" brought up
report on the bonds securing the by the Supreme Court.
Finally,
Mayfair House, 60 East 65th St., at long last a reorganization pro¬
New York.
Copies are available posal was filed for Wisconsin Cen¬
the taxes of these industries." Mr.
l
.• i
Dom. of Canada
Rock Island
for
cause
41
•ment, in effect, would be.paying
•>.
•
Royal
state Commerce Commission is go¬
Interesting
•;
Nova Scotia
«,
Chicago,
-
.
Grande Western.
to
H;
Mayfair House Bonds
con¬
part of production costs,
"It looks to
early end to the Eu¬
,
proposal
and that if contracts
on
an
ropean war.
an
said the taxes should not be
1
a
•
been less talk recently of the pos¬
ing
inquiry by Representative
Knutson (Rep., Minn.), Mr. Jones
tiated
in
1943 business.
'
,
and
y
-
,
It is probable that fighting at Salerno, with its indication that
army is still a considerable force to contend
with, had
some influence on the
change in^
speculative sentiment.
There has
controversy
over
Rockey, Chairman
treatment of RFC and RCC loans
of the Navy's Price
Adjustment
Board, supported a bill by Repre¬ through a cash compromise and
Cotton Belt has asked for author¬
sentative Doughton (Dem., N.
C.),
providi-g that the $100,000 ex¬ ity to make interest payments. St.,
emption in the existing law be Paul bondholders are waiting imraised
to
$500,000, effective on patinetly to see how the Inter-
and Navy representatives in con¬
of
recom¬
reserves
Kenneth
Corporation, joined Army
profits"
rea¬
contractors
taxes
tion.
who
also is head of the Reconstruction
Finance
"as
Department
allow
three-
Jones,
reserves
after
taxing authorities
that
version
and
profits
i
sway.
ances
after
period.
Mr.
of
doing
less than $500,000 of war business
annually be exempt- from renego¬
tiation, but opposed the proposals
that price adjustments be made
:pay about $4,000,000,000 taxes on
the
$12,600,000,000 of dividends
during
re¬
the
.i-.
Navy
mended
estimated that stockholders would
received
the
as
will allow."
In reply to a question by Repre¬
sentative Disney (Dem., Okla.), he
year
industry
expressed
out
come
sonable
!
'They
for
t
the, German
The direct immediate
"much too early"
of setting up
and
taxes," with such
comparative figures.
gave no
he
v
•.
The reorganization railroad bond market was shaken
out of its
doldrums in spectacular fashion around the middle of
last week, and
speculators found it just as difficult to buy bonds at
advancing prices
as they had to
dispose of bonds when premature peace optimism held
should
means
reserves
should
He described the $24,200,000,000
as a "substantial sum" when com¬
with
.that
as
.
view that "reserves for conversion
on 1941, 1942
profits on both govern¬
and private business.
pared
was
conversion,
1943
ment
>
testified
law
consider
special
000,000 in dividends
and
the
.
«"•
for
sociated Press
of
Jones
cost
■/>-;.
.
W
v-
Bell Teletype—NY 1-310
Railroad Securities
f
provide
renegotiation
to
guarantee the renewed buying interest, how¬
minimum profits for efficient war ever, was "apparently the unex¬
production, as well as to recover pected speed with which the court
"excessive profits."
acted in approving the final re¬
*
$24,200,000,000
Regarding their testimony, As¬
Washington advices
.
Mr.
thought
>
1942 and
after payment of taxes.
labor." ;■!;
or
•
Commerce
New York 6
(
Telephone—DIgby 4-4933
Change In Renegotiation Laiv Opposed
;
By Jesse Jones And Randolph Paul
Montreal
v,
.
,
Copy
upon request.
1. h. rothchild &
YORK 5
TELETYPE-NY. 1-1310
co.
63
specialists in rails
120
broadway
COrtlandt 7-0136
n.
Adams & Peck
y. c. 5
Tele. NY 1-1293
Wall Street, New York 5
BOwllng Green 9-8120
Boston
Philadelphia
Tele. NYT-724
Hartford
THE COMMERCIAL
1194
& FINANCIAL
;
CHRONICLE
| Thursday, September 23, 1943
Attractive New York City
Hotel Bonds
:
>4 *
During the first 7 months of 1943 we purchased, in
form, more than 1,500,000 shares of stock, both
Complete reports sent upon request
block
Seligman, Lubetkin & Co.
listed
and unlisted, for our own investment or for distribution.
firm bids
staff
our
Members New York
Broad Street, New
41
disposal to make
bonds for investment
Brokers
or
HAnover 2-2100
York 4
Real Estate Securities
be protected.
authorized agents will
INTERESTING COMPARISONS
in the prices of real estate secur¬
We note that the continual rise
qAllen
We have no doubt that this market valuation is
quite justifiable.
However, by the same category, we are at a loss to
understand the large difference in price of comparative properties.
As an example, the bonds of the Graybar Building are cur¬
pretty close to par.
Co.
&
Established 1922
rently 96%
HAnover 2-2600
Broad Street, New York
of
bid, while the bonds3>
Building are only issue general mortgage of $4,055,000.
The Taft bonds pay 5% in¬
In comparing both is¬
Chanin
the
S*3% bid.
bonds
too large a
John E. Schramm Is
OUR
Walter Whyte
REPORTER'S
formerly se¬
John E. Schramm,
way, New York, is now
Interstate Com¬ tiss-Wright Corporation in the
Commission has decided office of Burdette Wright, Vice-
merce
Stocks nibbling at
hearings as a basis for President in Charge of the
settling the long-smoldering con¬ plane Division.
■■■■>
Mr. Schramm will do research
troversy over the matter of com¬
work relative to the Airplane Di¬
petitive
bidding
for
railroad
bonds, a definite ruling on the vision and is located in the Divi¬
: question is expected within a rea¬
sion's executive offices at Buffalo,
sonable time.
not
New York.
L?;£P.
*
current is that
would like to
refunding job which would
for the marketing of some
report
One
Co. looms now
candidate for
market
once <' the
current
Third
War
&
Lorillard
likely first
the
as
the
money
i
Southern Railway
Treasury's
I
do
Loan Drive is out of
a
call
>
the way.
VV.; The big tobacco processor has
$20,000,000 of new bonds.
filed the necessary registration
One of its leased lines, the At¬
with
the
Securities and
Ex¬
lanta & Charlotte Air Line Rail¬
change
Commission
for
the
has a total of $20,000,000 of
outstanding first mortgage 4]/2S
way,
series A and B falling due
July first.
and 5s,
next
reported anxious
The road is
\
of
up
for taking
provisions
make
to
these
obligations • which
■j consfst of $14,500,000 of^5
I centiand the balance in 4
cents.-
per
per
shape up,.; the
■investment fraternity is inclined
to the belief that this undertaking
r.
things
As
now
provides
bentures
for
a
retire
sufficient to
fund
The
to
for
shareholders
for
each
I
137
be
little 'but
saw
it
would be insignifi¬
and was not to be fol¬
came,
cant
now
ad¬
rally, if
vise readers that the
sub¬
lowed.
held.
■
:;v/
probably will be- the first, or at
least among the first, to develop; Reorganization Rail Bonds ;
in the wake of the Commission's
Obligations of railroads in re¬
pending ruling.
organization came to the fore in
:
Well,
of
area
as
current re¬
that
requirements
are
fixed
interest
being earned 2% times. The TaftPark Central comparison is not
quite
feet with a rent¬
square feet,
as
good
as
the
Graybarthe
Chanin comparison, because in
635,000
former
are
we
comparing second
the
second
mortgage
which
did not
to cover,^in¬
then at about 138
the listed bond market recently as
turn tail and run
rulings in the case of several such
stead
issue of
$2,962,500 and 1.2% on the third
mortgage issue of $2,500,000.
/ Another interesting example is
the
Hotel Taft bond,
which is
941/2
compared to the Hotel
(870 7th Avenue) ;
bid,
Central
Park
bond which is 44
Both
hotels
bid.
are
in
v
the
TRADING MARKETS
Times
Park Central hak
Taft
Hotel
$3,437,823
has
a
SECURITIES
1,600 rooms. The
funded debt of
consisting entirely of
bonds outstanding*
if
Central
has
of $1,200,000, .and the
gage
it
Members New York Slock
a
Members New York Curb
$5,255,000 consist¬
AO EXCHANGE PL., N .Y.
/
Institutional first mort-V
ing of an
'k
SHASKAN & CO.
first mortgage
funded debt of
IN
REAL ESTATE
Square section of New York City.
The Taft has 1,550 rooms and the
know what hap¬ while; the Park
The market,
pened.
was
you
V'V
*
*
*
,
Illinois Central
flirting
market and continued to
shares
five
building built on a plot
inasmuch
good,
ports of the property indicate
Building built on a plot of
further
scription in the ratio of one new
share
Avenue opposite
The Chanin is a
compared to the 30-story Graybar
WHYTE j
grief ahead for the
Last week, I re¬
the de¬ optimists.
fused to see anything good in
sinking
half the either the rail or the general
would
stock
common
55-story
of 29,625 square
able
were
averages
with
proposed issue by maturity.
offered
/v\';
covering
covenant
the -Terminal.
on
Dow
of 20-year
debentures, and 374,391 shares
of common stock.
The
Lexington
is
.
$29,000,000
of
sale
and
payment in 1944 of a portion of
this accumulated interest in ad¬
dition to fixed interest of 4%%■
68,200 mortgage bonds with first mort¬
gage bonds, while the latter is a
No matter how interesting square feet with a rentable area of
1,000,000 square feet. 1942 interest comparison of similar liens. How¬
statistics
or
fundamentals earned on the Chanin Building ever, at 94% of the $3,473,823 issue
of bonds on the Taft, a value of
may be a stock market an¬ was 5.46%, compared to 5.85% on
$3,264,393 is placed on that prop¬
alyst has no business letting the Graybar Building. Gross in¬
erty, while at 44% of the $4,055,come of the Chanin Building for
his attention wander from the
000 bond 'issue on the Park Cen¬
1942 was $1,566,771, against $1,Action of the market into a
tral amounting to $1,784,200 plus
326,338 for the Graybar Building.
contemplation ofr, sucfy ex- Chanin bonds are due in 1945 and the $1,200,000 first mortgage, a
value on that property is placed
traneoussubjects. Thepunish- the Graybar bonds in 1946. Gray¬
at $2,984,000.
Because of the dif¬
ment meted out for such in¬ bar Building bonds paid 5% in
ference of price range, it would
1942, while the Chanin Building
attention is swift and some¬
bonds paid 4%.
However, in ad¬ appear that the chances of price
times severe.
T
dition to the interest paid on the enhancement of the Park Central
V?
* V"; *
* y/VVVVVV'V Chanin Building
first mortgage
bonds is better than that of the
leasehold bonds, they also paid 2%
Two weeks ago when the
Taft bonds.
rate, that
that will be the case, since there
private placement of new secur¬
'are more or less persistent reports
ities, but that the financing may
that several railroads are contem¬
ultimately
come
through
the
plating entering the market for market.
sizeable
refinancing
operations
and it would help considerably to P.1 Lorillard & Co.
j;L
have the air cleared in the foreT
going; respect.
much damage.
By WALTER
Bankers hope, at any
;
Chanin Building
old highs
Air¬ indicates
more
strength.
Minor
decline possible but
upon open
,
Railroad
the
that
Now
the New York Central
Terminal, while the
is located on the
southwest corner of 42nd Street
joining
Says—
with Cur- |
The probabilities of a
3% points.
Graybar Building is at 43rd
Street and Lexington Avenue ad¬
The
curity analyst for Ward & Co., in- |
vestment brokers of 120 Broad-;
REPORT
stock
carry
they carry accumulated interest of
properties is equally good.
of both
Curliss-Wrighi
bonds
representing an interest in a por¬
the Graybar Building amount to tion of the ownership of the prop¬
An interesting feature of
$7,502,000, compared to $6,059,500 erty.
for the Chanin Building. Location the Park Central bonds is that
Tomorrow's Markets
With
pay
Central
Park
Park 'Central
However, the
while the
4!/2%.
terest,
it seems to us that there is
discrepancy in price.
Both are first mortgage lease¬
hold bonds. Bonds outstanding of
sues,
i
of these issues up
brought the bid for the bonds of several
ities has
30
•
Security Dealers Association
are at your
all blocks of stocks or
on
Incorporated
,
for distribution.
or
-'v;:
k \ •; v ":C V-*,
•'* '•* •* Vv.'f
„v
Block Form
Securities in
The services of
;.
Exchange
Exchange
Dlgby 4-4950
Bell Teletype NY 1-953
\
bond
/
is
There
►
some
discussion
also
possibility of-Illinois Cen¬
tral undertaking to refinance its
of the
debt
•
tp the Reconstruction'Finance
Corporation.
The company
been .endeavoring to secure
has
carriers
down,
came
stimulate renewed
terest.
serving
to
speculative in¬
/•
" J-,
'
the
.return from the RFC of part of
the collateral pledged behind the
mod¬
ified plan of the Denver, Rio
Grande & Western, and the In¬
original agency loan of $37,000,000.
terstate
It
>
has
reduced to
since been
$20,000,000 and the road sought
Commisj sion permission to ask the Fed¬
Interstate
Commerce
eral lending agency
turn of
668,384
for the re¬
Court
sion's
securities
pledged
for
the
to
reconsider
its
kee, St. Paul & Pacific,-beyond
making adjustments ordered by
the court, speeded up
It
was
these
to
activity.
assumed that action in
might
cases
bring
a
be
expected
py $5,000,000, but
been confirmed.
this has
Report has it that the
been
shopping
around
road has
seeking
ness
not yet
ing
through the
reorganization,
mill.
Permission to
cific
to
pay
the Missouri Pa¬
back
interest
number of its securities
add fuel to
the fire.
on
it reached
the
142
.
figure, have done a call
am
a
double top position.
I
aware that all mar¬
welL
good piece of work. But hav¬
kets have to get into double
ing accomplished this there is
another obstacle for them to top positions before they can
Of course I can point to a
In the middle of get through old obstacles into
few isolated sentences in last overcome.
new.
high ground. But there
week's
column
to
"prove" this year the averages got to
is always the chance that .in
that "I told you so." But any¬ about ;• the.. same levels'-: they
are at
present;. It was from this case the obstacle will be
body who follows this column
that point The market broke. sufficient to turn the market
regularly knows that when
Obviously b uy i n g
The/reasons for that original down.'
new
signs manifest /them¬
break are of no immediate stocks at such a period pre¬
selves I have no hesitation,in
concern.
But what Vis im¬ sents the buyer with more
altering my opinion.
Now
than the usual amount of risk.
portant is that the market
having gotten that off my
For should the market react
chest I can go on to what the having rallied to that first
from that point the possibil¬
market
is
doing now and obstacle there is no guaranty
that the obstacle has been re^ ity of;being locked in for a
what it's action portends.
moved.
long period of time is very
Strictly as market action
142 and
a
high fraction,
,
general stepping up
of programs of other roads go¬
in June it was reported,
unofficially, that the road had
further reduced its RFC indebted¬
Early
continued ;to go • up
.
Commis¬
Commerce
refusal
for the Chicago, Milwau-.
plan
$81,828,884 of the $122,-
the RFC advance.
approval of
it
until the other day
a
served to
the familiar averages
ting
up
in get¬
to and slightly above
Technically the market is real.
(Continued
in what chart readers
now
on page
1217)
Volume 158
Number 4214
THE COMMERCIAL & FINANCIAL CHRONICLE
1195
Active
Insurance & Bank Stocks
Royal Bank of Scotland
Incorporated by Royal Charter 1727
Bought
ANALYZED
HEAD
OFFICE—Edinburgh
Branches
Trading daily 7
3
OFFICES:
a.
COMPARED
n
-
to 5 p. m.
m.
Inquiries invited.
General Gas & Electric $5 Prior Preferred
Quoted
—
Special Bulletin and Booklet Service to Dealers
throughout Scotland
LONDON
Sold
—
REVIEWED
-
Massachusetts Utilities Associates 5% Preferred
Brokers
&
Federal Water & Gas Common
(P. C. T.)
8 West
BUTLER-HUFF & CO.
Smithfteld, E. C. /
Charing Cross, S. W. I
,
OF
\
,
CALIFORNIA
210 West 7th
Burlington Gardens, W. /
#
64 New Bond Street, W. I
New York
Chicago
-
San Francisco
a.
\
279
;
l.
-
>
j
Bank and Insurance Stocks
Associated Banks:
Bank,
Public
This Week—Bank Stocks
/
Deacon's
Ltd,
An
interesting
Australia and New Zealand
BANK OF
NEW SOUTH WALES
1817)
Capital
£8,780,000
Reserve
Fund
Reserve
Liability of Prop.
6,150,000
8,780,000
£23,710,000
was
received recently by the
Wood, Chairman of the Board of American
Company, ' Charlotte, North Carolina.
Mr. Wood wrote in
reference to the following paragraph which appeared in an article on
bank stocks in the New York "Times" of Aug. 26, 1943:—"Bank stocks
do not give the highest yields available in the market, but many in¬
vestors prefer them.
The pricef
times
earnings
ratios
of
bank
stocks
range
all .the way from
Chase National, which is selling at
21, and National City, which is 17,
Aggregate
Assets
Sept., 1941 ;
30th
.
DAVIDSON, K.B.E.,
General Manager
Head
Office:
and largest bank, in Australasia.
branches
all
in
States
of
With over
Australia, in
New Zealand,
Fiji, Papua and New Guinea,
and
London,
it
and
■
efficient
banking
traders
offers
the
complete
most
service
travellers
and
to
investors,
Interested
in
thes#
-//'• Y-7:.;:r 77 7;7>;
countries.
OFFICES:
LONDON
;
We
Trust
47
arrangements with
Upon
to
Laird, Bissell & Meeds
Members
capital stocks
Bank
National
and
York
New
Stock
Exchange
120 BROADWAY, NEW YORK
5, N. Y
Telephone: BArclay 7-3500
City Bank of New York—
which we think is a compliment to
the Charlotte banking institution.
Chase
an
almost
We
unsolvable
have
He also developed
devious schemes for
and
heavy
tional
the
was
continuing
a
interest
in
Lehigh Valley
exchanging weak system securities
com¬
Chase National Bank and the Na¬
"It is true that the
Transit Co.
Bell
.
Teletype—NY
over-capitalization
tem
out of
L. A. Gibbs, Manager Trading Department)
Samuel
Insull, had fled to Europe.
son's
downfall
Hop-
traceable
was
1606 Walnut
American
The
to
two factors—a gradual accumula¬
tion of unpaid Federal tax claims,
and
Trust
the decision
of
the
SEC
St., Philadelphia 3
Pennypacker 8200
Private Phone
..
selling for about book value.
1960
BOENNING & CO.
bankruptcy long after
his rival in such finance,
1-1248-49
Refunding 5s,
the
of
top companies and the milking of
system earnings under the guise of
"service" charges, to keep the sys¬
COrtlandt
7
PH 30
to
N. Y. C.
7-1202
'
!
late
Company stock,
unpaid interest on all the numer¬
share, would be sell¬ in 1939 to cut off the upstream
ous
bond issues of the two
top
ing at less than book value—the flow of income from some of the
companies.
The
latter
saving
book value being now about $500 operating companies. Hopson then
hinges
on
important
litigation
"Times" states that the American per share."
capitulated " and
his
two
prin¬
■
[(Which would also affect numer¬
Trust Company stock sells for 7.7: Vlt is perhaps of interest, apropos cipal holding
companies, .'.famil¬
of its earnings,, . . ♦ We presume of Mr. Wood's remarks, to sub¬
iarly known as "AGECO"; and ous large railroads now .in bank¬
that
the
"Times"' figures were mit the 'following table which "AGECORP" entered the bank¬ ruptcy) which may eventually go
to the Supreme Court for settle-5
based, on 1942, although we are shows the ratios of current market ruptcy courts early in 1940.
not sure of this.
If their figures to 1942 operating earnings of 28 j: The present trustees — Stanley jment. ' However, this additional
related to 1942. earnings,< then.;I banks, together with the total re¬ Clarke for AGECO and Denis/J. saving would be only a temporary
think they are mistaken, because sources of each bank as of Dec. 31, Driscoll and Willard L. Thorp foif Windfall, for Associated, since it
Jcould no longer be claimed after
in January,#1943, our stock was 1942.
Seventeen of the banks are AGECORP—have made energetic
the reorganization plan is put into1
conscientious
efforts
then selling for about $350 per located in New York City and 11 .and
to
share (par value being- $100 per in other cities as noted.
straighten out the tangled mess effect, when almost ail AGECO
•
iand AGECORP bonds will be con¬
left by Hopson.
share), which would not have been
Ratio of
Total
Moreover, they
verted into common stock.
/ '
*'* " '
~ :
Market to
Assets
have made every effort to" keep
quite seven times the earnings for
;
The reorganization • plan
1942 Oper. 12-31-42
does,"
1942.
This would make our stock
security
holders
well-informed,
Earnings
($000)
however, propose to retain as
sell for even less times its earn¬ Chase; National
20 4
4,569,496 haying issued 17 or more volum¬
much Federal tax saving as pos¬
inous reports, including the plan
18.6
387,592
ings in relation to Chase and City Bank of New. York
18.6
sible, and will not set up;a new
2,995,499 of
National ' Banks. V However,
reorganization for the two
the Guaranty Trust
the
A.
out
result
years
for the good ones held by the pub¬
lic. Thus he was able, despite the
the sale of its stock, based
its earnings, with the two
in America — the
pare
of
Banks
the U. 8.
throughout
singled
Hopson,
making rapid progress toward re¬
may still be required to com¬
plete the realignment of system properties necessary to conform to
the standards set up by the
Utility Holding Company Act.
Mr. Hopson developed a vast maze of
holding and investment companies, and
the securities of these companies
'7., .■■■■■
and of the operating subsidiaries
j
were
interchanged until the net |
organization, although several
varied
Manhattan Company
Company of Charlotte, North
is
Associated Gas—the billion-dollar brainchild of Howard
now in a Federal
penitentiary—is
jig-saw puzzle.
J
largest banks
Berkeley Square, W. 1
Agency
-
that the American
means
Carolina,
29 Threadneedle Street, E. C.
k
Bank of the
Trust
length from
at
quote
now
A "This
George Street, SYDNEY
The Bank of New South Wales is the oldest
'870
American
the
Mr. Wood's communication:
ALFRED
SIR
for
7.7
to
£150,939,354
>
.
Trust
Company of Charlotte."
Utility Securities
Reorganization Plans
memorandum
Chronicle from Mr. W. H.
■
Teletype N.Y. 1-344
Associated Gas Making Progress with
7;#V.:
By E. A. VAN DEUSEN
Glyn Mills & Co.
(ESTABLISHED
Street, New York 5, New York
Telephone HAnover 2-9500
£108,171,956
Co.
&
Members New York Stock Exchange
280
a.
TOTAL: ASSETS
Williams
k
49 Wall
Seattle
-
Laurence M. Marks
'
,
wires
-
l.
...
:
St., Los Angeles
private
teletype
i
-
Public Service of Indiana Common
Orders solicited.
Bishopsgate, E. C. 2
49
Paid-Up
Trading Markets in
National
City
sell
Bank
re¬
at
$400
per
spectively for 21# and 17 times
their
earnings, whereas
the
NATIONAL BANK
of INDIA, LIMITED
Bankers
Head
the
to
Kenya
Government
and
Colony
Office:
in
Uganda
Bishopsgate,
26,
7;London, E.
C#V/777,,777/
Branches
in India, Burma, Ceylon, Kenya
Colony and Aden and Zanzibar
Subscribed Capital—->£4,000,000
Paid-Up
Reserve
The
Bank
Capital—--—£2,000,000 #
Fund——
conducts
£2,200,000
description
every
of
banking and exchange business
Trusteeships
-
■
,
and
Executorship*
<
also undertaken
__
Chemical
great disparity in the price of our
stock
Head
Office
£3,000,000
£3,000,000
world.
Cairo
RESERVE
CAPITAL
FUND
.
.
.
.
.
Cairo
8
.;
and
7
King
AGENCY
William
A#!,';;
Street, E.
Branches in all the
principal Towns in
V
EGYPT
and
the
C.
nec¬
earning
power.
or
If the American
Company stock sold for only
times its net earnings for
"
Bank
&
the
Chase
and
the
Na¬
208,383
17.0
1,643,855
1,040,271
(Boston).
16,4
1,168,026
(Chicago)
15.9
15.7
1,767,082
3,761,671
140,962
i, /•,,
107,223
7L 673,169
__
National
.United
City
17.0
___
__________
States
15.7
Trust-.
Continental Bank & Trust
York
New
Bankers
15.7
Trust_____A 14.8
Trust
14.3
Exchange Bank &
;
1
1,625,080
,
14,2
568,935
14.2
Ll
First National!New York)
1,014,254
Bank & Trust (Chgo.)_
13.0
National City (Cleveland)
13.0
333,699
12.7
1,036,191
265,366
11.5
1,419,495
Manhattan—11.4
994,538
Bank
of
First
National
Bank of Am.
&
(Detroit)
National
S.
First
2,197,459
12.6
Bank
National
A.
Trust
(Phila.)_'_
Nat'l.
Tr.
11.3
r
(California)__
National
Security First
(Balti.)__ '
152,568
7
11.2
2,771,689
8.5
7# 264,827
National
tional
City Banks.
On the divi¬
(L. A.)
-AT.—8.3
870,431
149,048
dends being paid: now, the Chase 'American Tr. (Charlotte) 5,6
'Based
on 11942
indicated
earnings of
National yields 3.90% on the sell¬
As of Oct. 1, Thomson & McKin$72.00 per share as reported in Moody's.
ing price of the stock. Based upon
non, 11 Wall St., New York City,
the dividend being paid now,' the
Chase:;heads the list with the
members of the New York Stock
National City Bank yields 2.8%/ highest ratio;of 20.4, as well as the
Exchange and other : leading Ex¬
At $400 per share: (par value' be¬ largest 7.volume
of
total
assets.
changes, will admit to partnership
ing $100' per 'share), !tlil Ameri¬ American Trust of Charlotte is at
Frederick R. Home, John J. 'Ma-.,
can
Trust Company, ;• based upon the foot of the list with the lowest
loney, and John A. Reis.
Mr.
dividends • being paid-now,^ yields ratio, but not quite the lowest in
Home and Mr. Maloney will have
total assets. Although investors are
their headquarters in the firm's 3.50%#; #:
willing to pay a higher premium
New York office.
Mr. Reis will 7 "The-National City Bank stock-
Will Admit Three
!
be in
has
Indianapolis.
a
and
par
E. 0. D. Campbell Opens
E. O. D. Campbell
the
has resumed
investment business from
fices at
of¬
1 Wall Street, New York
City.
Mr. Campbell was previ¬
ously in business as an individual
dealer
in New York City.
The
value of $12.50 per share
book
a
for
sells
value
about
Chase
of $33.21,
$33
National
v
per.r.
Bank
and
year.
a
New officers
appointed
sub-holding companies, and
number
of the smaller
proper¬
ties have been disposed of.
top holding company but instead
merge the two present com¬
will
panies into
a "surviving" corpora¬
tion, thus retaining the invested
capital base of both companies.
It is also hoped" to include in
two set¬
the merger
the most
important
important
sub-holding company, known as!
Manila
property
to
the
Japs
(though this may prove helpful NYPANJ, which constituted about with taxes if a write-off is ob¬ two-thirds of the system. Many of;
the NYPANJ properties can prob¬
tainable), and failure.to effect sale
The system has
backs—the loss of
of
the
South
had
the
Carolina
properties
ably be retained under the "death'
sentence" of the SEC, since as the
indicates they are located'
$40,000,000. ...On the other
in.New York and the adjacent'
hand, the system got. a "break"
States of New Jersey and P6rmsyl-,
last year when Congress permitted
vania. However, while NYPANJ's'
consolidated system tax
returns
finances are in healthy
(so that "bad" earners could be
condition
combined with "good" earners, to so far as its public holdings are
concerned, there are many' inter¬
bring down the average taxable
corporate holdings and entangle¬
State
a
authority
power
.
for
name
some
,
income),; This permitted
a
saving
Hence
the
ments.
there is
proposed (as a corollary ptogram
to the reorganization plan) a se-
$3,400,000 and
possibility of a further
saving of $4,500,000 if the system
a
is permitted to deduct accrued but
(Continued
on page
Public
Bought•—Sold
—
Quoted
'
has
and a
sells for
about $35 per share.
The Chase
National Bank stock is selling for
a
par
value of $13.55
book value of $33.77, and
a
little
the
more
National
than book value, and
City Bank
stock is
mere
size is not the criterion.
For
.
,l
#•
'
•
.f
•
•
•
.
example, Bank of New York has
the highest market ratio,
point of size as measured
by total assets, it is in the lower
next
but
to
in
(Continued
orPpagd
1218)
V
Utility Preferreds
that
*•
,i
r
ing institutions of size, power and
an examination
of the
figures shows clearly
1217)
v
for- the stocks of certain outstand¬
above
trustee's have1
in Federal taxes of
share! prestige,
stock
were
7
to
Continental Illinois Nat'l
..
companies, released June 14th this
to the
17.1
—
_______
National
Manufacturers
of
155,245
Irving Trust
First National
First
top
1,289,984
,
National
1942, it would be selling today for
$600 per share (par value
being
$100
per
share),
which
would still be less than the selling
ratios
17.6
17.3
Trust
Public
at least
.
Trust-
—
Central Hanover
twelve
:<
SUDAN
bank does not
&
77'.77 #777 7 77
/ Trust
essarily constitute its strength
Trust
■
■Commercial
,
a
Bank
National
(Pittsburgh)
Corn
-
.
"The size of
LONDON
and
of course,
tent
|
Commercial Register No. t
FULLY PAID
Chase
the
City is due, to a large ex¬
to Chase and Na¬
tional City being located in the
largest and richest city in America,
with surrounding territory of im¬
mense
wealth
and - population.
Their location, therefore, is prob¬
ably in the richest section of the
of EGYPT
I
of
National
NATIONAL BANK
;
that
and
First
Paine, Webber, Jackson &
established 1879
v
\
Gairdner, Son S Go.
Toronto
Back the Attack!
BOND
Exchange Firm
organized here to
business.
in the new Toronto Ex¬
v
Incorporated
v
14 Wall Street,
Bell System
•
.
/,'
C. W.
Teletype NY 1-920
/-
SERIES
Prospectuses
1
-
120
&
Board of Directors of Gairdner
INTERNATIONAL
COMMON
upon
request
NATIONAL SECURITIES & RESEARCH CORPORATION
..
MacLean, R. P. Howard, and J. H.
Gairdner have been elected to the
New York 5
SERIES
FIRST MUTUAL TRUST FUND
P.
It is also announced that
PREFERRED
STOCK
STOCK SERIES
are: .J. A. Gairdner,
Crysdale, G. P. Watt, A. G.
Walwyn and J. H. Gairdner.
'
SERIES
Securities Series
LOW-PRICED
change firm
J.
Wood, Gundy & Co.
INCOME
n/tioMl
,
BOND SERIES
brokerage
a
Partners
/
LOW-PRICED
been
recently
conduct
V
SERIES
TORONTO, ONT., CANADA—
Gairdner, Son & Co., members of
the Toronto Stock Exchange, has
I
BUY WAR BONDS!
Thursday, September 23; 1943
FINANCIAL CHRONICLE
THE COMMERCIAL &
1196
>
208 So. La Salle St., Chicago
10 Post Office Square, Boston
210 W. 7 St., Los Angeles
'
,,
At
Broadway, New York 5
Co., investment dealers.
By BRUCE
on
the whole prices
of
Canada! 3s
1958
Governor Dewey's bold
alliance with the British
towards an objective for
have the completed edifice, but
but
sagged lower.
were obtain¬
at 104, the 4s of 1960/50 at
11014 and the 3s of 1967 at 103Vs.
Canadian National 5s of October
able
1969
offered
were
IIIV2,
at
the
4%s of 1955 at 118 and the 4I/2S of
1957
•
///////r/
Provincial issues,
at 11714.
the
Among
British Columbia 5s of 1954 could
3.50% basis, New
Brunswick 434s of 1960 at a yield
be
bought
slightly
Manitoba
on a
better than/3%%
and
4V2S of 1956 at 4.10%
was some demand
There
return.
for the shorter-term Nova Scotias
and
the
hands
41/2S of 1952/47 changed
on a
also
2.40% basis. Saskatch¬
fairly active and
the 51/2$ of 1946 traded at 101 and
ewan
were
; Internal issues
and
were
the
STANY To Present
from a
This factor is
of interest
hitherto rejected.
the
with
line
were
the
out of
then
rates
the
in increased
exchange
The
raise
drive/to
the
ing the last war, the record of the
so far during this war and
the facts about our present econ¬
of
purchase
12:30
Association.
4
.
will
Music
after the last
be
fur¬
be
period.
a
pre
out
of
by
in 1918 and the
peak
end of the
/" Distributors
;
lished
which should enable buyers to se¬
cure
bonds at favorable prices.
Although
it
the
at
appears
;:
hurry,
now
nevertheless,
and
the
end
of
f six
& Co.,
John
consequently improved from 97/8%
to 93A% discount.
Now that the
Loan drive and the close of the V
September
tober,
National
on
had
the
pleasure
despite
where,
Calvin Bullock—A
record-breaking indus¬
net profit re-,
maining after taxes has actually
/
,
issue of
"Petrol¬
discussing
eum:
declined."
W. Long & Co.—New
folders on the Aviation and Chem¬
:
investing-- in
securities
on
earnings comes
"By
Post-War Outlook."
claim
before
taxes,"- the investor may
the effect of higher corpo,-
folders
Inc.;
Stocks,
ration taxes on his investment in¬
Current return on General
come.
which
Shares
Bond
represents
a
-
•
*
*
,
'
-
,,,
:
* /
on
current
portfolio
New York Stocks, Inc.
and Manhattan Bond
Fund.
Keystone Corp.—A new current
data folder on Keystone Custodian
Funds.
/ ///■. '■ /.'
;•'//:•:,// '. ■"•.
/•'
:
.
.
Series of New York
ical Industry
whose
escape
/
Hugh
Ltd.—A
Hare's
Insurance
tutional
new
folder on
Insti¬
Group Shares of
Securities, Ltd.
V/:v';
An interesting discussion of the
,
endowment funds
common
stocks (despite
trend in college
of/reading
toward
Wright's article on inflation
higher corporation .taxes) is pre¬
am glad to note that he em¬
and
new
Perspective
bonds, is 6.5%;
;■
Current
Securities, Inc.
of Group
our
—
trial activity, the
& Financial
-
ten
point
a
and
present
Wright
Editor, "Commercial
Chronicle":
■
.
were
diversified investment in discount
Article By Ivan
/
they
ago! They have increased
Group
on .. Railroad
General Bond Shares
folders
portfolio
Shares
Mutual
/'
.
.
Distributors
;
times
1939—about
to
Gommehts On Inflation
....
Trust Fund.
years
J.
•
what
times
four
over
are
what they were in
Goodbody &
Larkin,
rates
tax
&
Dr.
War
folders
Securities Series and First
;
"Today maximum corporation
Abra¬
Aal,
Jerome
C.
things, it points out that:
other
Captains
I
between
the
National Securities & Research
Corp.—New
General
on
york
63 wall street—new
pub¬ ■j
has
Group
folder
new
a
Incorporated
GROUP#
reached until the
following year. /
./> .;
not
was
Navy
a
participated in, the drive.
of-' the sub-committees
firms
Co.,
drives
loan
the
yC DISTRIBUTORS
after the signing
rise
Prospectus on Request
-
:
Inc.
band and Bond
Shares, a Class of Group Bond Series, National Preferred
George E. Price,; partner in the
Securities, Inc., in which the in¬ Stock Series, and International
Stock Exchange firm of Price and
Series;
a
discussion of
"some;
crease in corporation tax rates is
Davis, arid a wqll-known stage
facing the returning
graphically portrayed. "How To problems
and night club Entertainer, will
PROTECT and INCREASE Your Congress" in the latest issue of
act as master of ceremonies.;
/;
Income In An Era Of High Taxes" Investment Timing; a current in¬
A total of 305 individuals and is the title of the folder.
Among formation folder on- all National
nished
Heaney, Joseph McManus
At the present time there
few stale long positions,
jley
In all of them
war.
came
the big
O'Kane, John J.
rent, but now the proposed rates
O'Kane & Co., Henry Peiser, Ira
look quite attractive.
Haupt & Co., Fred Preller, East¬
It will be a bull point for the
man,
Dillon
Co., Abraham
narket in general if a solution
Strauss,
Strauss ' Bros.; Edward
vere reached in these two
cases,
Thompson, Smith, Barney ,& Co.,
n any event, as it has been pre¬
and Robert Torpie, Merrill Lynch,
viously pointed out, the market Pierce, Fenner & Beane. ; /•/;//'
las
now
experienced an antici¬
pated healthy reaction.
We shall
loon
a Class of Group Securities,
Supplementing the text of the
Long Co. Letter are charts show¬
ing the market pattern of eight,
leading stock groups during and
of the Armistice
■
of the Army
Navy will be present to ac¬
cept
the gifts
which ; will: be
driven away by four men from
service.
achieve."
world is straining to
Representatives
Thomas ' A.
cur¬
every
and
each
Equipment Shares
fear of
Formal presentation
at
./v.-•
Railroad
do not seem to justify any
peace—the objective which
resource
of the (civilized
omy
these vehicles.
will be made
p.m. on the steps of the
Sub Treasury Building 'at Wall
and Broad Streets by B. Winthrop
Pizzini,
Bj
W.
Pizzini ;&
Co.,
President of the Security Traders
the
///•/•.■'
;:..••//
ex-<£-
are
market
for
funds
•///;//
thoughts
same
pressed as follqWs in Keynotes:
"The history of the market dur¬
Securities Corporation, Chairman
of the Committee which carried
on
and that it is on the forces of construction
destruction that sound securities values
of
those
on
must be built."
be
Friday,, Sept. 24,
on
than
rather
Co., Chester de: .Willers,
C. E. de Willers & Co., Michael J.
rates could be criticized on
grounds that they
forces
Letter and Keystone
title to this
Co.'s New York
&
the pattern of World War I indicate that peace
"Both logic and
is bullish, not bearish,
by the Security Traders Associa¬
tion of New York, according to
Walter F. Saunders of Dominion
ham
suggested
rates; the previously
armed
Hugh W. Long
Corp.'s Keynotes draw the conclusion expressed in the
column.
Writes the Editor of the Long Co. Letter: <
the United States
to
over
Included:
trend
present
ambulances/ will
Eight:
turned
Both
;
Eight Ambulances To
Army And Navy
;
moment that there is no undue
free
Investment Trusts
of
"PEACE IS BULLISH"
.
the)4V2s of 1960 at 89.
demand
Assistant
the company.
practical point of view,"we have not yet finished digging the founda¬
tion. Undoubtedly, the best foundation is one based upon economic
collaboration, thus combining a<»>
cleared up in the not too dis¬
friendly relationship with mutual
tant future.
self-interest. Already the Pacific
The latest refinancing plan has
Codst States and Minnesota have
taken
steps ; in
this
direction just been submitted to the City
Executive Committee and, if ap¬
thrpugh the formation of joint
economic committees for the study proved, there is now reason to
believe that it will be accepted by
of the development of territories
the bondholders.
In support of
on both sides of the border.
this belief, it can be stated, fol¬
The New England States to¬
lowing a report from London, that
gether with Ohio and California, the
City
of
Montreal British
have made Canadian securities
Stockholders Committee has is¬
fegal for investment by savings
sued an interim report saying it
banks.
It would seem logical
was hoped, because of the general
that the State of New York, es¬
position reached in discussions on
pecially in view of Mr. Dewey's
the Montreal debt, that "a plan
recent
announcement,
should
may be submitted which we can
give favorable attention to the
recommend
for
acceptance
by
efforts that have
been made
British stockholders." In the case
since 1936 to make it possible
)f Alberta, it is generally recog¬
for savings banks in New York
nized that the province is anxious
to make attractive additions to
co
rehabilitate its financial posi¬
their portfolios in the shape of
tion, if possible before the end of
Canadian securities.
f
the war, in order that Alberta can
The past week has seen a con¬ take
proper advantage of its rap¬
tinuance of the market quietness
idly expanding economic develop¬
that has prevailed for more than ment.-;/v'. /•;'•./;//;///\ ',■// /v/, a month.
There were some evi¬ /
There is also one common fac- ;»
dences
that
prospective buyers
tor in both cases that will exert
were commencing to test the mar¬
pressure on the creditors to ac¬
ket
and the general undertone
cent plans which
have been
seemedt somewhat improved,
be
Manager of the Montreal office
WILLIAMS
political utterances headed by
declaration supporting an outright military
Commonwealth, are indications of a trend
Recent
which, theoretically, we now
will
Allman
E. J.
Canadian Securities
V Investment Company Reports
; I
Keystone Custodian Fund Series
assets as of July 31,
"B3"—Net
sented in the latest issue of MIT's
1943,
amounted to $19,481,417,
several ^ pertinent facts
Brevits. The bulletin cites income
equivalent to $16.97 per share,;
with this rather
and inflationary considerations as
compared with $16,192,049 and
abstruse
subject; ; / In the
first
checks is exhausted, further buy¬
time for making purchases on a
probably having influenced this
(Continued on page 1218) / j
ing of internals can cause a fur¬
scale.
,/'//
v:'//'- olace, he says that every war has trend. The following figures are
brought inflation; this, of course,
ther hardening of the Canadian
given on ten leading college and
is a matter of history, but John Q.
dollar iin the free market. How¬
university endowment funds:
Citizen seldom realizes it because
Hastings In N. Y. C.
ever, it must be borne in mind
- Percent of Security Holdings
John A. Hastings has opened of¬ from war to war he forgets all
that the internal issues called for
vr.
.;; (At book.values June 30, 1942)
payment Oct. 15, next, should re¬ fices at 420 Lexington Avenue, about it, and then plunges head¬
'
Pfd. Common
without regard to conse¬
Institutions—
Bonds
Stocks Stocks
sult in a further supply of free New York City, to engage in a long
of
supply
dividend
Canadian
phasizes
Victory Loan in Oc¬
should be
an
which have to do
opportune
,
.
exchange at this time. After this
date, if this supply is readily ab¬
general securities business.
'
'
sorbed and Canadian internal is¬
sues
continue in demand here, we
shall
no
pressure
doubt
on
see
a
renewal
of
We
specialize in
CANADIAN
selling rate for Canadian dollars.
is
It
opportune to
review at
this time the position of the
situations
the
which
otherwise
have
Government
-
Municipal
Corporation Securities
namely,
Alberta
real.
there
the
Province
now
clear indications
this
situation
might
be
Dr. Wright points
out.
I.
M.
Hopkins— ' 56.0
T.—
39.3
52.9
56.8
;
Pennsylvania
—
♦Stanford
55.0
42.0
Vanderbilt
Yale—
—
.48.5%
Average
good point when he
W.
ELLSWORTH,
<
H. E. SCOTT CO.
49 Wall
St., New York 5, N. Y.
Vice-President, The Hibernia
National Bank in New
Orleans.
'
Tele. NY 1-2675
Sept. 14, 1943.
~
"
44.8
10.9
11.2
14.0 /
4.4 v
28.3
11.8
- 7.2
1, 20.4
•
44.1
39.2
,
30.0.:
56.3
18,8
31.4
37.8
37.6
Custodian Funds
Certificates of Participation
in
.
Trust Funds
/
investing their capital as follows:
J
Qpniv*!
/
B-l, 2, 3 and 4 in bonds
♦As
of
Aug.
31,
37.4%
14.1%
1942.
''
'
/
Recent Investment Company
Literature
Lord, Abbett—A new
_
folder on
Stock Fund; a
revised "leverage" folder on Af¬
Preferred
Union
WHitehall 3-4784
that
between 1933
49.6
Harvard
that "inflation when it gets
will not wait on a de¬
FRED
With regard to the latter,
are
19.0.;,.
45.0
bating society."
of
City of Mont¬
and 1937, as
says
13.4%
35.6
Cornell
Johns
20.5%
66.1%
U-
<'
Dartmouth
under way
perfect record of
and the
indicated by the
of invest¬
and corporatioris
He makes a
Canadian financing in this coun¬
try,
as
unfortunate experiences
ors
two
marred
Wright
the contrary,
the exchange at the
Foreign Exchange Control Board's
also bangs on the
head the false notion that going
;nto debt is a hedge against infla¬
tion.
Here again history proves
Dr.
-—_
California
quences.
composite sum¬
of the Lord, Abbett group
filiated
mary
oi
Fund;
a
investing companies.
Series
K-l, 2 in Preferred Stocks
I
Series
*
S-i, 2, 3, 4 in Common Stocks
Prospectus may be obtained from
your local investment dealer or
The Keystone Corp. of Boston
50 CONGRESS
STREET, BOSTON, MASS.
Volume
Number 4214
158
THE COMMERCIAL & FINANCIAL CHRONICLE
1197
loans, have resulted in
Bankers
Urged To Continue Efforts To Curb
reduction
in
interest
Jhough
Increased
invested
in
to
Carolina, In ABA Inaugural Adress
.
'
Warning the bankers that/'the American system of free enterprise cannot survive un¬
banking maintains its independence and fulfills'its lawful credit functions,
the newly elected President of the American Bankers Association, A. L. M.
Wiggins, in
his inaugural address declared that "free enterprise under
politically administered credit
is not only unthinkable, it is impossible." "It therefore," he
asserted, "becomes our solemn
duty, as the custodians of the chartered banking systems, to continue to multiply our efforts
;
less chartered
;
■
•
'
selling and issuing
ciples
bonds have
all
but
war
in many small banks.
by
have foremost
the
turn
to
come
nec¬
grips with
cour¬
stand for the prin¬
a
will; ■ determine
the
,,
if
won
year
the
democratic
be
freedom
to achieve is to survive.
the tide of
Govern-f
ahead.?..>?-.'/:.??
?/>/.•••
ment lending, direct and indirect, sonable risks as part of the nature
sponsibility, we have been blind
We
can
say
with confidence
5 whenever it exists only on boun- of the business; Government guar¬ to the recent
history of this na¬
that, on the whole, the house of
lies from the public treasury.; The anteed loans of all types, although tion. The public will not
approve,
'
banking is in good order.
recognized as temporary expedi¬ nor for long tolerate, any
It is
inaugural adbanking
dress
of
Mr. ents in times of national distress, methods that are against the
pub¬ not only fully meeting today's
war,; or peril, have little if any lic interest;
-Wiggins; who
However, the notable requirements,; but is alert to the
is President of place in a peace-time credit struc¬ contribution of banks in the war
to
funda¬
It is
ageously the battles that must
consideration
in
and
Consistent with these principles,
we will fight
militantly and cour¬
These prob¬
Association
that
•
future,
country banks require and
this
keenly
character of American life in the
wiped out the net profit
lems of
will
of
we
and
grave
the
ageously take
do¬
expense
bankers,
the problems before us and
the
this, the increased costs of
of
As
fully
essary now to
addition
ing business and the
become
mental issues involved.
Government
up
existence.
aware
deposits, al-
securities, fail to make
Chartered Banking Must Maintain Independence If Free Enterprise Is to
Survive, Says
difference in income.
In
A. L. M. Wiggins, President of Bank of Hartsville, Hartsville, South
•
mere
must
to
banks, particularly in agricultural
sections.
;
serious
a
income
back
We will fight for thd"preserva-
"
tion of the dual system of char¬
*
tered banks.
*
the
ture,
of
Bank
Such
proved to
loans
be
have already
opiate, deaden¬
Hartsville, at
Ha rtsville,
S. ,C., marked
t h
abilities.
conclud¬
e '
ing session of
Associa¬
make of
War
ing; it follows
in full:
V:
con¬
vention,
and
h
t
the
have
to
given
of
an expanded post-war
economy.
Unless it does so, the Government
will do the job, and our nation
the
of
for
will
the
needs
of
this
and to follow
gram
another
and
fateful
affirmative
this question.
were
never
serve
nation,
the pro¬
through on
which has been carried
a
step
never
chinery
is
Its liquid
It
in
never
better
such
notable
before.
never
under
success
At
the
same
able
guidance
of
it
President
Hemingway.
is
a
It
of
is
marshalling
and
men
riod
era
and
the
to follow.
readjustment
dynamic
in
pe¬
the
American
business
and
free
the
the
other
freedoms,
essential
but
freedom
Special
tunity
vidual,
to
achieve
whether
he
no
borrowers
more
place in
society
than
it
this
be
If
as
we
are
mentals,
to
return
American
to
individual
local,
will
and
enlarge
its
indi¬
farmer,
muster
may
banker, American life
entre¬
the
stagnate to the dead level of
to
war
our
<
^ood
to
Equally clear is
vation of
a
is
no
of
We
need
are
to
and
bankers,
•
As bankers
our
own
houses.
the
doubt
we
that
aware
that
efforts
business
there has become
pro¬
whether
workers,
to
in
we
hearts
own
the
If there is any lingering
the mind of any of us
interest
serious
lems.
An
difficult
income
of
compe¬
We
united
a
Reduced volume of loans,
rates, and the
costly and deadly
war.
small
tition by Government agencies for
are
a
prob¬
immediate challenge is
low interest
charged with a
and a public re¬
and
declining
banks.
banking is
public
ac¬
Chartered banking is confronted
should examine
our
savings
counts.
with
and
coldly receptive
and increased
of
living in a period of transition unparalleled in our history.
Our people and our national lead¬
ers are deeply concerned with the
nature and the organization of the
we
new
or
bar of public opinion.
urge
well
policies,
farmers must win approval at the
problems
the
will of the peo¬
Therefore,
grams
sound and serviceable
importance
It is the
ple!
the preser¬
economic way of life.
These mandates I accept.
; now face.
,
assure
banking system as
essential part of the American
There
-
mandate for
dual chartered
V an
.
Court.
a
prompt, courageous and vigorous
action that will
.
war are
ation will continue.
-
•
the
one
should
make
peace
win
sound
a
under which the
whole world
world.
Banking, to¬
gether with the rest of our social
and economic order, has under¬
gone
revolutionary changes
in
methods and procedure.
Further
adjustments may be ahead.
May I state, therefore, some fun¬
be
people with
purpose — to
and
live.
can
post-war
—SPECIALISTS
IN—
,/.
>
United States Government
American
enterprise
chartered
of
system
cannot survive
banking
V,:'
Vv'-YX.
'
independence and fulfills its law¬
credit functions. Free enter¬
under
tered
V••
v.?
Territorial Bonds
it
as
f r..•••
that purpose.
'. v* " K:;V
..." .••?/*;/-.,■} v..
Agency Issues
Chemical
bank
Municipal Bonds
It therefore
solemn duty
" *'\-vvy
«
Guaranteed Issues
Federal Land Bank and Other
credit is not only unthink¬
our
*•
>"• i
;;
adminis¬
prise
becomes
•'*'
••/V. V
its
ful
able, it is impossible.
man¬
Securities
■
politically
pledges
and
free
unless
maintains
resources
power to
damentals to which I believe the
overwhelming majority of Amer¬
ican bankers now subscribe?
The
This institution
its
&
the
custodians of the chartered bank¬
TRUST
ing system to continue and to mul¬
tiply our efforts to turn back the
tide of Government lending, di- j
rect and indirect, whenever it ex¬
ists
only
on
bounties
from
treasury.
Just as
money drives out good money, s**
does unsound credit destroy sound
credit.
No Government subsidy
public
can
C. J. DEVINE
48 Wall
Chicago
»'.
•
Boston
&
major
corollary
165
Broadway, New York
•
Cincinnati
Philadelphia
•
St. Louis
•
•
Pittsburgh
San Francisco
•
Cleveland
Charter Member New York Clearing House Association
Member Federal Reserve System
Member Federal Deposit Insurance Corporation
of
this
proposition
that banking and
private finance must return to the
type of, credit that accepts rea¬
CO.
Street, New York 5, N. Y.
hide this brutal fact.
The
COMPANY
Founded 1824
the1
bad
Direct Wires to all Offices
are
and
other
asso¬
we
full strength in
protect and preserve
these principles.
savers.
daily in¬ American people.
Saving is and always has
We must be realists and recog¬
creasing
the
responsibility
of
been
the
rockbottom
base
on
bankers. Their leadership in war nize that the final arbiter of the
which capital is formed. Without
financing and their full coopera¬ dtstiny of this nation is not the
it there can be no
tion with the Treasury is more Government, its
credit, and
Congress, its ad¬
than ever required.
nor
This cooper- ministration
its
Supreme yet American banking here and
to prosecute
land, they
In taking action,
ciation groups, to the end that
funda¬
service
peo-
■
bankers, and those
State
commercial
banking must recapture the
the
,
our purpose to
mobilize,
unify and consolidated the efforts
of
manufacturer,
.
it will be
of
the
\
broad
oppor¬
merchant,
will
'
without
of
for
"
'
ready for action.
We may have
on
our
and disposition of the bankers
across
democratic
preneur, or
between
economic
with
freedom to achieve.
return.
monopoly.
as
along
that
f If I interpret correctly the tem¬
per
come
no
the public
believe
ocratic government.
or¬
time,
to
only
can
seek
support of the American
Ple-
How¬
we
expense of
We
„
opportunity
of
all
is just and that it will have
cause
;
ever, such
freed
privi¬
welfare.
post-war
serve.
be
hand
In
'
opportunity to
to
suffocating
lege at the
Commercial banking is seeking
every
fight for the
of these efforts
plans and programs to anticipate
the needs of the
banks
Government competition.
its
credit
the
We will
the
has in the administration of dem¬
searching and finding new
to multiply its usefulness to
ways
.The mounting re¬
quirements for funds with which
a
and lenders has
v
the
reasonable
a
competitive basis and
as
privilege
to
resources
serving the nation
and
never
greater, its desire to
stronger and its ma¬
was
der.
on
answer
plus
fair
'
with
resources
all
dered
Commercial banking has a forth¬
vigorous and comprehensive
effort to serve the financing and
war
take
right
continuation
a
other
that ap¬
Credit should be merchandised
down the road of State socialism.
mandate
administration.
incoming
It ? calls
which
represents,
clear
a
weaken
care
American
ciation
it
to
.
Bankers Asso¬
Wiggins
practices in banking
or
tend
Service charges should
willing, able, and ready to take capital.
of the credit requirements reflect actual costs of service ren¬
is
14,000
o f
e
members
us
tendencies
which
from
changing needs of the war-time
economy.
of
'
:
This
the
non-risk
loan
principle will
feeble addicts and the
vigor and independence of our probation must be rooted out.
banking system will perish. ??';'? Interest rates should be kept in
The life or death question which
line with costs and risks involved
the private credit system must
in the legitimate requirements of
soon answer is whether or not it
Service Meet¬
M.
■
post-war; period,
guaranteed
;
tion's
L.
ture
have
earned
for
banking
widespread public approval. Any
Carried too far into the
the
A.
effort, their role in- the national
economy,-1 and their assistance to
industry, commerce and agricul¬
ing our sense of independence and
weakening our faith in our own
an
rights
THE COMMERCIAL &
1198
increased
have,
A"
ent
in the immediate
said.
duration and
handling of the govern¬
portfolio.": '1v" • Y:'%;
'
In
this
considering
a
criss-cross movement
of deposit*
"Some banks will
after the. war.
^adverse; effect on prices lose -deposits while others will
certain obligations and values.'' gain/ he predicted, depending oh
have
of
an
vestment
policy
liquidate
•
■
,next fe\y
they strengthen their
If
•
,
,
will
be
in
"Considerable thought must'
are
,
deposits,-the^
holdings as to maturity."
exceedingly strong
an
goods
and
will
same
smaller -than
ever
in
before
banks./;' There is
'/''v\''/;:/|
subject of inflation, Dr.
No
opinion/exists
to whether . V
of
unanimity
bankers as
among
should be continued1 in'-the
loans
serious danger
"The volume of deposits of
and will continue to
Dr.
the
Nadler asserted the banks should
of the
mount," said-
Nadler, who further stated:
.
financed in so far
be
war
possible Through
materially-as
increased
has
banks
On the
deU
and
taxes
through the; sale * of Government
obligations jo ultimate. investors.
It. would indeed be dangerous to
of" the banks if- too large a propor¬
tion of the public debt is held by
capital1'.resources' to deposits' has
them." V. - - N.y.A.
■/•. I;
decreased.
This imposes on the
"At the same "time the ratio
the
banks
obligation
their assets in
possible
as
necessary
as
premises,
been
a
an
real
estate
has
appropriate asset
bank and certainly will not
in
immediate
the
post-wai;
period. As far as possible,'there¬
fore, real estate should be liquid
of
adoption
of solv-
as a means
iishfrient of
njent-owned banks.
/
competition
Discussing
"Since
great
a
assets
of
portion
the
banks
in¬
efforts will be made to retain and
is
vested in government
obligations,
the investment problem for most
'he banks of the country, will be
called upon to assist in
tion o+
these
convert
they
so
that
in peacetime.
agencies
function
can
for
the solu¬
number of international
a
period;/ So far as' possible/ there-'
forb/:;real:estate;shiOuld/,be/liquidatecl./r Sound mortgages have al¬
ways-been a good investment for,
banks,/ particularly: those operat¬
ing
with time.. and savings" deposits.1 In view, however,, of the
future. ;;of -reaj * festa"te',\lri
many, sbctions of the country, it is
advisable;/, that banks •/ insist Ori
satisfactory amortization on the
part: of the-mortgagors;/:. /■
Yf. j:
,
.
he
debt
to
create
/ There/ is
rency
and to see to it that the plans are
actions of the
private banks." '
follow in
Nadler's remarks
The
global
materially
has ' affected
national economy
fully reflected
war
our
and this in turn is
in the
position of the banks. Hold¬
ings
of
securities
Government
*
be;
criss¬
a
ume
very
the ,total vol¬
deposits in all prob¬
of bank
ability. will
continue to increase.
.will, lose
deposits
will gain.1. In those
way- centers: where business ac¬
tivity, is bound to decrease at the
Some'
banks
others
while
end * of
hostilities; as well7 as in
,
which// have
districts1'
rural
exceedingly large
benefited a great/ deal during/- the
floating debt, serious efforts will
be made by the Treasury' to con¬ ward deposits-will decreased:/ Ori "
the other hand, those centers in
vert tne maturing obligations into
an
which consumers' goods are pro¬
of medium or long term
duced are bound to gain in de¬
maturity. Since the banks hold a
posits. Because of the uncertainty
large portion of the short term
of the .movement of deposits, all
debt of the. Government, they will
banks, particularly those operat¬
bg- particularly interested in these
ing to a large extent with demand
refunding operations, but because
diversify their
of the sharp reduction in the ratio deposits, should
Government holdings as to maof capital resources to deposits,
they may be unwilling to accept
There is, however, no need to
in exchange for short term ob¬
ligations long term or medium over-emphasize liquidity and to
term bonds.
It will not be pos¬ Curtail earnings because of con¬
sible to shift a considerable por¬ cern over a material change in in¬
those
of
tion
to other invesr
debt
the
On the contrary it is reason¬
to
the
assume
that
at
the end
investors,
non-bank
war
a
During the war the
rates.
terest
opinion is almost unanimous that
no
change in interest rates will
take
place.
For
period of time after hos¬
a
tilities will have come to an end,
the
to
money-market will continue
dominated by the needs of
be
The latter will be
the Treasury.
confronted
prob¬
lems that will confront the banks
funding billions of dollars of ma¬
turing obligations.
There is also
bound
to
be
a
deficit of the
These will be some of the
at the
ERA
i
to
of deposits after
post-war capital expenditures.
SECURITIES
WAR
bound
-movement
the. war,; although
are
If plans
of
of the war.
end
made for the sound solution
these problems, all the others that
will confront the banks
during
and
y;
after the war can be
solved.
readily
The purpose of the pres¬
smaller
Securities
lems
;
end of
bonds
how
lems.
Association, Inc., Chicago, Illinois, August 20, 1943
/..
'-//y ■'/;;
1
".■/ /'/ »:./
war.
in
to
con¬
order
capital
to
ex¬
It is logical to assume
number of individuals will
a
redeem
.hostilities. So far as pos¬
suggestions will be made on
to remedy the pending prob-
cash
post-war
penditures.
that
endeavor
into
their
sible
Corporate Meeting of the National Security Traders
the
during
will
them
meet
ing the war and to ascertain those
that Will confront them at the
re¬
substantially
though
than
of
task
Corporations which have invested
consiaerable sums in Government
vert
analyze the prob¬
chat confront the banks dur¬
the
with
Treasury,
ent address is to
Before the
banks/' is
'
ligations, will endeavor to liqui¬
date them in order to meet their
PATRICK B. McGINNIS
the
tiori.'/'// '-■■■*;Yt11;':V1;1;/.:,:. |,}"
cross
considerable portion of
their reserves in government ob¬
by
of
-
..shoulcllbe: taken into Vconsiderk-1
.handling of the pub"-,
bound
is
ate:, with
placed
An Address
.
assets
.inentjt/portfolio: ;•'•• In Vconsiderihg
this phase, /.the following facts
notably corporations, which have
POST
appropriate 'asset
certainly will not
the /- immediate '/ post-rwar
•be /iii;
Even
ing system, of the country.
the orthodox
of
THE
.
.
able
IN
an
bank and
a
total
tors.
RAILROAD
been
never
problems in which they them¬ .'serious
problems for the banks. At
selves are directly interested/ -11.
the/end of the war the floating
"It is their duty to advise, and debt / pf the -United States will- be.
counsel the governmental agen¬ .tremendous.-/ Since it is .danger¬
cies in all matters relating to; cur- ous, for any Government' to oper¬
from
Nadler believes that after the war
/earnings.// Exclusive of
'premises,; real" estate, has
bank;
*
:
of the
the
on
necessary
destroy the function of banks. Ay problem
Dr.
,
has " de¬
imposes
;
obligation of keeping
their assets in. as liquid a position'
as
possible //commensurate; witli
scale after the war would .tend to
estab-1 destroying the international trans
system of govern-
a
toy deposits
This
mojst
the debt problem and alleviat- workable and not merely visioning the tax burden.
Adoption of jaiT 1V- character. Above all it is
this
plan,
he
declared, would i to .their interest to prevent the
wreck the banking system and! newly created organizations frorn
would lead to the ultimate
At
for
ing
government lending agencies, Dr.
dated.
total
would lead to
with banking plan
earnings. ' Exclusive of
never
be
position
a
commensurate
bank
for
of. keeping
liquid
again
materially
mount.
in¬
government-: i^es. /.There is the danger that eft vested in
government obligations,
forts/ will be made to reduce the
guaranteed loans wiliC'e/kistf chirr¬
the investment problem for'
rate/of. interest paid by the Gov¬
ing the initial periodof; recon¬
institutions narrows /itself.1 dowii
ernment on;; its: obligations /held
struction. However, To perpetuate
to the; handling ' of. the vGoverhThere is the added
the system of V loans on a large by the banks.
need
limited
stabilization. They;-must
recommendation for j ro^ke .available to these agencies
the
100%
reserve their knowledge and experience.
He ieels such a coiimtion
to
the
banks
danger that, in order to solve the
of the clebt service, .the
a'do'ptidn : of / the * ■ 100% / reserve,
mands that may arise in the imr utilize all;the means at their dis¬
y "In
addition to thevVtypically
banking / system will be pushed:
mediate post-war period," he told; posal and should spare no effort domestic problems that': will "arise
in fighting the forces of inflation.
These measures if adopted will
the bankers.
" /:;•
should urge that the cost I out of the war and its aftermath, have serious effects/on the bank¬
position and able to-meet any
continue
measf. /// Since a, great, portion;7 of ..the
economic
unorthodox
of
Undoubtedly-a
post-war period.
a
post-war' period effortsmay be made to alleviate the debt
burden
through
sleight-of-hand
devices or through the, adoption
•that in the
}:
deposits of the
time the ratio of capital
creased.
:
also
of
increased
.
resources
the
history .of the nation.-.
Govern¬
ment 'lending
agencies ' have
iiiultiplied and are offering keen
j be given to the future- of V -loans,"
extent-, with
demand deposits,
-should; diversify its government
-
4.ur'
.
holdings are based on the possible
future movement of
area, or
Government-ul^r& those operating to a lai^e
extent-. with
demand
their
if
mortgages,
war
produced.
Because of the uncertainty of the
movement of deposits, he recom¬
mended-that "every bank, partic-
during the course of the
months.-
a
consumers
assets
doubtful
their
in
they will
now,
institution is located
in centers where
whether the
sound in¬
"If the banks adopt a
banks1 has
re¬
;■;/ /
:.y,;i;
volume
the
suffer
period of business
any
/- The
.
phase, Dr.
Nadler feels there is bound to be
pronounced^;, he
and- probably will,
feels ''it may,
down
itself
narrows
during
of action.;/,,
.competition to the private institu¬
tions. Their personnel has unclerr
gone ta, considerable' change,; the
number-of women;;employees - 'in
''Now is the time/' he/observed; many, banks exceeding that- of the
'to make careful studies, as' to the .men. i;.';;;Tyy
future relationship betweeiik pri¬ Z{These "changes,./while " creating
vate
and
government
banking. :mahy;serious problems, are '• how¬
These
should
be
^-undertaken ever/; greatly
overshadowed by
jointly by the government and' by the- dangers that may arise; as a
the banks with the view"'of .clear¬ .resplt
of /the / rapidly - mounting
ly delineating the sphere ..'of; ac7- /debt and / the..large; volume /.of
litftk' nf each.
<•'* v.
of
government securities held by the
to .the
ment
not be very
may
v
institutions
depression will prob¬
this
ably not be of long
■
witness
may
of depression, he:
period
While
post-war
of the war
end
while1 the volume
year,
which, are/.; bound: to
ties
the
during
steadily : decreasing and 'is today
1 •///V;
possible or anticipated movement of deposits
period and should take into consideration the possibility that
policy, should be correlated to any
This
:
■
decrease
deposits has reached an un¬
precedented level." *; The ratio of
capital resources to deposits," is
'/-J
Bank Division of the ABA.
before the National
address last week
to
bank
arise in the future is one of, the most important problems facing the
time. Dr. Marcus Nadler, Professor of Finance, New York University,
may
a
past
enable them to meet any situation thlt;
banks at the pros?
declared in an
investment policy which will
Adoption of ati
tended
-v
New York University,
of Finance at
Professor
the
:y'yV/V:; '/' /V:1; ?
; ''By DR. MARCUS NADLER
vol¬ ings and-, to liquidate those securi¬
rapidly, the
of real commercial loans has
ume
Adopt Investment Policy Now
Bankets Urged To
Thursday, September 23. 1943
FINANCIAL CHRONICLE
some
in
their
of
order
to
buy
E
durable
Series
consumers' goods.
the
Until
budget of the Gov¬
balanced and pro¬
have been made for a
is
Copies
.
'
;
v
\
'
on
written request
.
.
./.'•;/.>
on your own
■
.
1
...
•'
5
-I
_
;
•
/■'
.
,
ture.;
.
PFLUGFELDER, BAMPTON & RUST.
''
.
'
61 BROADWAY
NEW YORK 6, N.
telephone—DIgby 4-4933
Bell
may
Above
arise in the fu¬
all the
investment
policy should be correlated to any
possible or anticipated movement
of deposits in the immediate post-
•
r
Members New York Stock Exchange
gradual redemption of outstand¬
ing public debt, and until the re¬
funding
operations
have
been,
completed, no material change in
interest rates is to be expected.
most
uation. that
letterhead
.
,
1
j
ernment
adopt an investment policy which
will enable them to meet any sit¬
1 1
.■
.
important problem
before the banks at present is to
The
<
T
if'
:
'
visions
Furthermore, it may be assumed
that at the end of the war, when
/wairperiod and. should be based employment is not so plentiful as
at present and the volume of con-./
■bhfjh'e following ^considerations, •
The end of the war may
'' C
Y.
Teletype—NY 1-310
i
witness
depression.
While
this depression will probably) riot
be of long duratibn and fnay ■ not
be very pronounced, it may, and
probably will, have an adverse
effect on prices of certain obliga¬
tions arid values. Now, therefore,
is
the
time for the.
banks to
a' period
ftrTntinize
of
carefully
theif
hold¬
sumers' goods has
turn
.
flow
of
increased, a re¬
currency/from- cir¬
culation will take place.
This in
to increase the
amount of reserve balances of the
will
turn
member
an
tend
banks. and thus prevent
Increase
These
as
lead to the
terial
in
well
as
interest
rates.
other factors
conclusion that a ma¬
change in interest rates is
VM, ,ll(
,">. i "v
-Volume 158not
Number 4214
THE COMMERCIAL 8c FINANCIAL CHRONICLE
1199*
likely in the immediate post-
flation, .< it is doubtful whether forces of inflation?* They should circulation
today is far greater
[w.1.war period.
J.'-xXX they will be able, to, meet the urge that the cost of the war
be
than
is required for legitimate
The investment policy; of the needs of
industry and trade that financed in so far as possible business transactions and a
return
banks, .however, should not be will arise if the price level should through taxes and
through the flow of currency from circulation
based merely on. the ..fact that no be
.substantially higher than it; is /sale or Government obligations to woulct be of material
assistance in
material
losses'
be
can
sustained ;at the
from
holding medium or even
longer term Government obliga¬
tion
present time.
will
be
/This
further
situa¬
;
ultimate
deed
aggravated
investors.
It
would
in¬
financing the
be
dangerous to the banks,
later, if too
tions.
Rather it should be based sic value
of-the)'capital* resources ; large a proportion of the public
on
the policy that some banks of the banks
themselves because debt- is held by them. Now more
may
lose deposits and that 'it these, too, are invested either in than ever banks
should encourage
would be highly dangerous to the loans or in fixed income-bearing .thrift and
urge the repayment of
banking system as a' whole if in¬ obligations, the value of -which
outstanding
debt.
"
Everything
since-inflation reduces the intrin¬
as
Banks
will be pointed out
particularly
ly
banks
forced
were
to
does
•
not
increase
when
rshouid be done to induce hoarders
of currency to deposit it with the
'.com¬
liquidate
long-term Government modity prices rise materially. .X'X
obligations in order to meet the X What, can banks do to fight the
outflow of deposits.
Each, bank
.
banks.
as
Banks
deposits,
deposits, .from
a
result
should
of
continue
confronts
aside
The volume of currency in
.
the
from
adoption
banks
the
,
of
at
for
these policies and prac¬
fort.
The
the
have;
amount of
idea
some
deposits it
of
and
the
period
interwoven
to
with
be
the
situation
the United
in
that time.
in
the
closely
economic
will
that
States
at
Most of the
problems
banks will be
confronting
the
banks
will
political
prevail
the
primarily by political and
(Continued on page 1210)
caused
investment
,
.
should
fate
post-war
present,
need
sound
a
Govern¬
tically
all
have
assisted
the
Treasury in financing the war ef¬
cultivate customer relationships.
In brief, the main problem that
,
dividual
increased
war.
the
assist
proper financing of
Most banks have already
adopted
those whose income has material¬
:
;
to
the
the war.
seek
time
in
ment
war.
should
is
policy,
'
the
of
lose in
may
the reconstruction
period, and a
like amount should be kept en¬
tirely in ,short-term Government
obligations.
As pointed* out be¬
fore, a general reduction in de¬
posits is not likely.
On the con¬
trary, an increase will take place;
lience.
those banks gaining de¬
;
posits will be
the market for
in
fshort-term Government securities
which will be liquidated by those
losingdeposits.
However,
the
former, too, because of the sharp
.
,
decline in the ratio of capital re¬
sources
to
deposits
the
and
un¬
certainty that may prevail at that
time, may be unwilling to buy
long and medium term Govern¬
ment obligations,, but they -will
certainly be willing to buy bills
and
certificates
short
X ; tions.
well
as
other
as
Government
term
obliga-
■ X" "
'
the
banks
should endeavor so far as possible
to keep all their funds fully in¬
'
'
x
-
.
XX During
the
absolutely
There 'is
vested.
.
war
no
risk involved in acquiring Treas'
ury
bills
edness.
or
certificates of indebt¬
Banks, therefore, instead
of keeping idle reserves with the
Federal
Reserve
banks,
should
endeavor to employ them in short
term
Government
obligations.
Every bank should, endeavor to
the utmost of its ability to in¬
i-
its
crease
account.
Government
This
:
desirable
is
WHY MORE EMPLOYERS ARE ADOPTING
loan
war
not
only from the point of view of
the Treasury but also because it
tends to increase its earnings. \;
If the banks
v.
adopt a sound in¬
policy now, they will;
their
doubtful
assets
vestment
liquidate
during the
of the next few
they strengthen their
course*
months.If
mortgages, if their Government
holdings are based on the possible
A suitable
pension
plan, soundly financed, establishes
more
stable,
future movement of
deposits, they
will be in an exceedingly strong
position and able to meet any de¬
mands that may arise in the immediate post-war period;".*";*'
XX;
1
of
volume
The
loans,
chants
as
Those
-
well
made
as
.
; :
decrease
to
XXX
1
-i
•'
i
:
V
increase.
loans
and
advised
may
banks
to
set
earnings derived from such
loans
in
to meet any
that
tingef.ey
future.
"arise in the
v-"'.-. -XXXX
may
.
The banks should utilize all the
mean:*
at their
spare
no
forces
of inflation.
sense
modity
a
prices
lv,,\
»
/•
1
»
i
""Y/\
(
y
v
'A
v
^
.
-.iv;*.:
.i—
to Social
.X
v-
Security.
y*r.-
't Vv
x\ X> xxx.xX'X'
.•
;> u,:- *
open to younger
:
••
3. fit affords an effective financial consideration for employees without
a
plan creates
i increases
>
t
,
'--"'A
v; r
*
measures.
xx XxX'-rxx,x-x.
Such
x;
.
•
employees.
X-Xx
an
:
xXX> v^xxX'';-'^ xxXXx:-.
-/
>■■■
impelling incentive for long-time loyal service,
efficiency and decreases turnoyer, thus reducing payroll costs.
'
-
'
..X:
-
90-page summary oj the fundamentals of formulating and financing
pension plans is
for this study,
available. There is
now
so
ivrite
no
obligation entailed in writing
and have the facts when
us now
you
need them.
in
fighting
the
Inflation
sharp rise in
reduces
the
in
com¬
pur¬
chasing power of money and de¬
posits. Should this take place, it
will give the demagogue an op¬
portunity
to
incite
depositors
against the banks.
Furthermore,
inflation will materially increase
the need for working capital on
the part of industry and trade.
Because of the.material reduction
THE
CHASE
NATIONAL BANK
/OF THE CITY OF NEW YORK
N
.
'
in
'.
'
disposal and should
effort
of
•
con-
'
y..''V'jr
X? '? {v
anti-inflation
be
reserves
up
'
'•■"jidcre'aring free spending power—coinciding with governmental
X'XX/x.
create
would
out of
order
X
;
hand, V. loans and ordinary loans
made for the purpose of further¬
ing the war effort will tend to
problems,
*
-
the de¬
of
;
promotion
"
:
will
goods
because
clining supply "of goods available
consumption.
On the other
the
■■•>*.
.'v
•
2. It provides automatic retirement which keeps the avenues
of
mer¬
for
-
:Y>.
">
/
by providing benefits supplemental
'
:
1
-T /''v'
*
!• It relieves employees from worry about financial security in old age
-
manufac¬
to
consumers'
of
turers
•
satisfactory employee relations. Here's why, logically—
v"'
be almost entirely
during the■> period, of
hostilities..
well
'i
/
may
liquidated
also
more
'
the
* on
whole, will tend to decrease dur¬
ing the war. Loans made for the
purpose .of financing durable con¬
sumers' goods, as well as personal
loans,
:
the ratio of capital against de¬
posits, and because there is no
way for the banks.to protect their
awn capital resources against in¬
Pension Trust Division
-
rw
IT BROAD STREET
;
v
s
•
1
Telephone HAnover 2-9800
.
_
NEW
YORK 15
'
/■ >«'.'•
f.-
■
7,I
>■"
•
'■ t'r"r:']■' \\ i'
-
•
12C0
-1
.
j--.
:
FINANCIAL CHRONICLE
THE COMMERCIAL &
slowed
Thursday, September 23, 1943
>
What Is
accumulate
''v'.;,
By JOSEPH C. ROVENSKY
Discussing "What Is Ahead in the Americas?", Joseph C. Rovensky, Vice-President
York, told the War Service Meeting "that there is little
of the Chase National Bank of New
Western Hemisphere are on the threshold
of a great development." He pointed out, however, that "much will depend on post-war,
conditions and also on the degree of mutual interest which develops between our country
and the various other countries of this Hemisphere with respect to post-war cooperation."
mind but that the countries of the
doubt in my
have mounted
high because of Our inability to
supply in war-time much of the
manufactured > goods
and other
commodities needed by the coun¬
tries to the south of us. Naturally,
of dollar exchange
Bank of New York
Vice-President of the Chase National
:
reserve
These reserves
countries ' will
those
be;
dollarminded"
than
and
States
'
go
Now, on the liability side of the
ledger may be listed some minus
items, as follows:
There
1.
will
be
some
rem-
,nants of Nazi influence here and
there
working? hard
poison
to
/
inter-American relations.
more
' :
/
There may be some degree 1
of resentment over the inabil- ;i£
2.
;
•
ever
ity of the United States to pro- '
They will have incurred
deficiency of at least'three years
■vide.urgently needed materials "
"U.
S.
a
things which they greatly
to bur southern"
i ,'
neighbors dur-T<
•.ing war-time;/.::'
In
thinking h about what > lies situation will bring us, as Amer¬ need, and for which ; they■> have
contemplating ahead for the" Americas in the icans, great opportunities and, if looked to us in the past. Natu¬
we
accept them, great, jobs to rally, they will be. eager to ab¬
investigating
possible op- post-war period, it is necessary for
perform.
j
sorb the
products of our great
i
v
portunities for us to try to visualize what the
However, much will depend on manufacturing industries in The
post-war busi¬ general picture will be when peace
the attitude of our own people. United States.?'
If the succession of events
ness
in South comes.
United
to
resources,
•:
before.
in many
that "a large number off*individuals and companies in the
In stating
the
.as
ahead.1
been able to
substantial
a
of dollar balances.
V:
-well
of
countries
the
down,
Latin America have
There
3.
countries
are
will
liberality
;
be
in
'••
some
•
great expectations of
from
United
: the
,
,
Will
really become interna¬
Rovensky ex¬ probable, the end of the war in tionally minded, V and; in which
parts of the world will we have
Then,
pressed
the Europe will come first.
a
greater interest? >: Which will
victory
has
been
hope "that later, ' after
seem more attractive?, Which will
they realize achieved in the Far ...lEast,the
that the peo¬ world will be at peace again. And bring the greatest opportunities?
America," Mr.
South
ican
the
in
ples
should
Amer¬
countries
themselves are
-doing
some
develop
as
now
as it comes in
confront us with
peace
will
seems
After
each area
the
aggregate, as a nation and
individuals, in the light of a
world
which • lias
been : • largely
torn by war, there is no doubt
as
that
planning and long and will be marked by suc¬
The
investigating cessive stages of progress.
of recovery and re¬
of their own." machinery
"If we on our habilitation will start in low gear,
Joseph C. Rovensky
he
Hemisphere,"
"fail to find a
observed,
formula
for
development
will work out to
our
which
mutual in¬
then
war
also will swing
successive stages but at
swifter
pace
than
can
be
losers."
seas.
'•>.>/'' r;•;>>
Toward the end of his remarks
indicated that it
thought that "it is highly
Rovensky
which have occurred in
inter-American
relations during
economy
achieved
in
reconstruction
the
war
years,
as
the necessities
of war-time have produced mixed
of the
Americas were forced into greater
interdependence by the loss of
The
blessings.
over¬
possible to com¬
European re¬
construction while the war still is
It may be
assisting in
mence
on our. neighbors in the
Hemisphere. We shall be
changes
through
a
our
inspired by the forward march of
the Americas, now more, closely
bound together than ever before.
It
is
important to
note
the
industries to fit into a peace¬
terest, then we both will be the
Mr.
Western
go
time
shall, focus rriuch of
we
attention
into second speed, and
'
on
theirs, in finally into high speed. *
this
Western
At home the conversion of our
side, and they
consider these questions
we
in the
probr
post-war reconstruction.
Therefore, the road back to nor¬
mal peace-time conditions will be
of
lems
we
peoples
world markets and world
of
made
supply.
This
each
sources
it
other.
neces¬
but
sary for us to cooperate more in¬
such assistance probably cannot
appropriate that the bankers of
telligently and more thoroughly
be rendered on a great scale until
the
United
States
should
post
was
his
themselves
future possibilities
on
within this Western
Hemisphere."
being fought in the Far East,
final victory over Japan
with
has been
i
won.
'
At the
same
time, scientific and
technological developments have
The building of a new Far East
might indeed," he said, "be a
brought us substitutes and new
helpful move if the American will be a stupendous task. There materials, some of which are here
The Phil¬
Bankers Association should give will be so much to do.
to stay.
Just as the war created
consideration
to
organizing an ippines, along with Australia, the a new situation in this respect,
"It
Dutch East Indies and other areas
inter-American Division."
Mr.
Rovenskey's
lows in full:
fol¬
address
be
hopes
>
r
will
revitalized
and new
,with
so
with
the
coming of the
new
This
ambitions.
still another pattern
There will be
new
peace
will develop.
dislocations and
problems affecting raw ma¬
terials.
The marvelous develop¬
new
of
ment
United
Banking Service
-
synthetic rubber in the
is a case in point.
States
Many authorities have
expressed
the
'
in
opinion that the synthetic rub¬
ber industry is here to stay. How¬
Washington, D. C.
rubber
The
Bankers, their clients and friends
:
in the
r'.
Robert V.
Capital
George O. Vas»
Fleming
able
products. That trend
depends on the kind of
world
will
we
the
and
have
which
Vice-President
President and
and Cashier
Chairman of the Board
be
areas
growing
a
retard
AA
-
na-
tionalistic
..trend
pattern of trade that the world
will
adopt. ' If agreements and
understandings cannot be reached
which will make for a free world
in
5.1 I fear that in some
will
v,
?k/XiX?i.,1
fi:
.
:
;
,
;
;
T
and
greatly '
hamper commercial and indusi t;
may
trial developments where out- :
side assistance would be, useful.
trade, then man-made
again will restrict the
free flow of goods.
There is little doubt in my mind
to
However,
glance that
shackles
one
can
sheej; presents
ance
able
at
see
a
the whole this bal¬
on
picture. ;
favor¬
opinion
a very
is
It
my.
the
countries
of
the that in this attempt to take a
Hemisphere are on the frank and realistic look at the
threshold of a great development. inter-American scene we may find
But here again much will depend many reasons for
encouragement
on
post-war conditions and also and optimism.
\' .;;,y
on the degree of mutual
interest
A large number of individuals
which develops between our coun¬
and
companies
in
the
United
try and the various other coun¬ States are
contemplating and in¬
tries of this hemisphere with re¬
vestigating possible opportunities
spect to post-war cooperation.
for post-war business
in South
For instance, the areas of South
America.
I hope that they realize;
America that lie in the temperate
that
theV peoples
in the South
zone, where the agricultural prod¬ American
countries
themselves •
ucts
are
basically the same as are
doing some planning and in¬
those of the United States and
vestigating of their own. After all,
Canada, naturally must compete each country belongs to its own
with us on the world market in
people and they properly will set
dispensing of whatever surplus of the
pattern and decide what they
those commodities may be pro¬
think comes first.
However, if
duced. : Thisi economic fact ought
we on our side and
they on theirs
not to be permitted to continue
in this Western Hemisphere fail
as a source of irritation and mis¬
to find
a
formula for develop•
understanding.
/.
ment which will work out to our
The American industrial
and
mutual benefit, then we both will
business interests which are wisely
be
that
but
Western
■
.
the losers.
giving consideration to the exten¬
sion of their operations in South
All of
'
business
as
us
men
;
may
rightfully take pride in the out¬
standing achievements which cap¬
America will receive the collateral
the pioneer
work
which our industry has done in
the past in the countries to the
south of us. :r Many pioneer com¬
benefits; of
ital
and
United
have
countries
many
from
management
States
made
veloping the natural
the
in
de¬
of
resources
in
the
Western
panies, including Singer Sewing
under the spur of war necessity Machine, the Linotype, National Hemisphere. The real significance
doubtless will be used within the Cash Register, and International of teamwork and cooperation in
that field becomes apparent when
producing countries to meet their Harvester, have made it easier for
we stop to consider that millions
own needs.
our
automobiles,
refrigerators,
of tons of copper in the Andes
The production of fibres, twine, radios and aircraft to be accepted,
Mountains were of no practical
because
United
States
products
rope and burlap likewise can sur¬
value lying dormant deep below
vive in the Americas, as well as were found to be good. The radio,
the surface.
But the enterprise,
and
the production of edible and in¬ the movies, the catalogues
large
capital
investments,
and
edible vegetable oils, which has our North American merchandise
great engineering skill of men
been
greatly accelerated during, are making us all kin.
I have endeavored to draw up from the United States, together
the war.
with rugged native workers, have
a
hypothetical balance sheet of
It is an exceedingly important
our
inter-American relations as made it possible to extract that'
fact that the countries to the south
such a balance sheet might appear copper from the mountains, trans¬
of us in this hemisphere constitute
at the end of the war.
On the port it to factories, and fabricate
the only part of the world which
it into gleaming, wire and other
asset side, the pluses, are the fol¬
on
balance
will
emerge
better
lowing items:
;r;,:V. products which serve mankind in
off at the end of the war than
a
thousand ways.
At the same
1.
We have shed blood in a
before.
As a result of the sale
time, the people of those copper
common cause—there can fye on
of
vast
quantities of materials
mining countries in South Amer¬
: stronger' bond.
'
welcomes the opportunity to serve
Nation's
a
situa- '
debt
trend, a feeling of
self-sufficiency,... tending to;,: induce restrictive legislation affecting immigration and activi.-ties of foreign companies. This
to sell their
in- turn
'
there
J
from
buying
its
in which "they are
areas
*;
certain countries of the Americas
Riggs National Bank
■
supplementary natural
that has been produced in
the
ever,
expand
to
try
those
defaulted
tions.
However, as the markets of the
woTld gradually reopen, the nat¬
ural trend will be for each coun¬
*7y.
4,. There will be. a number of
r
-unsolved
'
-
.
Resources
over
Founded
$220,000,000
1836
needed
Member Federal Deposit Insurance Corporation
in
the
effort
war
of
the
without which our
fighting machine would have been
Latin
The
publics
will
dollars
than
they
FIGHTING DOLLARS FOR FIGHTING MEN
ment in basic industries which have
.
roads, backbone of the transportation so vital
today;
in public
supplying the unparalleled war demands for electric power; and
utilities which are '
a
trade
Air
LIFE
INSURANCE
COMPANY
CHARTERED
-
AMERICA —1835
and
of
;
more
remind
than the
soil
lift
to
life
and
the
you
com-^
trop¬
banana
secluded place
as
table luxury to its position
rare
great
a
staple food used by
of people.
It was the
vision, the organizing genius and
marketing skill of business men
as
millions
'
south
from
developed
each other—
with
to
the
and
the
United States, together
large capital investments,
which accomplished that transformation
and
an
at
.
'
attempt
of., the
same
time
inflow of wealth
an
areas
where the
industry flourishes.
At. this
their
the
improvement in the living
standards of those
banana
of the Amer¬
the south of us have set
The peoples
sights higher. They have
the ability and the ambition, as
and
brought about
natural
barriers.
7.
IN
a
transportation has con¬
distances
quered
icas to
MUTUAL
industry,
expanded,
greatly
with
climate
the
to
me
of fertile
plant from its
most useful trend.
6.
FIRST
mining
nations
have
us
their
THE
bination
production of rubber,
The
5.
Life Insurance Dollars Are at Work for the Whole Nation!
Boston
the
„
let
that it needed
increased.
of
George Willard Smith, President
Similarly,
dollar- '
wages
communities.
S.
and
fibres and oils has been sharply
bonds themselves.
1,1
more
substantially
ical
the
and
rail¬
in U. S, Government
New England Mutual Life Insurance Co.
before
have' been materially
through invest¬
organized for all-out war production; in
U.
more
ever
in
have'contrib¬
that
their
re¬
Certain of their industries,
notably
pREMIUM DOLLARS support the war program, combat inflation, and provide pro.
American
have
be
benefited
revenues
uted
minded.
4.
.
will
have
tax
understanding.
3.
tectiori and future income for millions of American families
ica
We have developed a closer
2.
United Nations,
point
I. should
like
to
brief appraisal of some
problems in the area of
a
.
Volume 158
Number 4214
finance and investment.
•the
countries
in
THE COMMERCIAL & FINANCIAL
CHRONICLE
Most of
the
v
In past years
the attitude of
the-
our
Americas: government, for rendering iinancial assistance to the, countries
commercial
•
banks
local
and
'there is
their
of
Those banks handle
•
domestic
own.
of
most
the
business
and
important conflict be-
no
•tween them
and
the
branches
of
•the United States banks and other
•foreign
the
.
banks
which
in
operate
various countries. The North
American branch banks comprise
useful part of the financial ma¬
chinery in those countries and are
•a
constructive factors in
developing
their
•
foreign .trade. There is a
need and a place for both the do¬
mestic and the foreign commer¬
cial banks and it is quite impor¬
tant,- in
accordance
with, the
ciples of commercial banking, that
us
institutions,
has been prudent and
•
are
and
resources
of
the various
South
American countries increase, more
reason¬
conservative.
for
the
and
nationals of South American
of-material
tries
countries
of
assistance
the
to
terest.
On
whole, I think it has done a
good job.- :'.
;:, ri'
As we contemplate the future
development which appears to be
•
in
the
Americas
countries.
I
have
minority
Under
majority holdings
der
citizens
of
in
fears
no
conditions.
our
of
a
un¬
I
do
favor
our
going
There
In the first
favor
that
the
of
the
I
would
tention; in
a
goodly participation in
enterprise by the nationals
what
would
accept
as
principle that
what
777:;'
fundamental
the
as
as
first
sumer
only
into
needed
instance
be
can
are available
limited basis in a few
a
area.
fective
financial
machinery
made
tion
of
useful
many
anything like
of
ume
strongly feel that
a
sales
things, i If
comparable vol¬
of
radios,
capital prob¬
inadequate to meet
contempated '; expansion
in
be
many: of
-Southern
the ' countries
•
•
•
As
war.
Hemisphere
a
•
The
cies
•
the
after -the
result, there will be
on
long term basis,
a
exchange rates
of
the
wartime
on
Americas
period
curren-
during the
have
remained
fairly stable, whereas the past
ord
•
a
need for considerable outside
cap¬
ital which is willing to make in-
vestments
■
of
was
tuations.
proved
those
rec-,
This
spotted with wide fluc¬
With
the
greatly im¬
position of all
financial
countries
which
have
a
tion
.
of
when
I
-
'*
'
belief that the
banks,
trade
•
'-
-
'<««
\ ' '
M':
businesses and. in*
dividuals identified with
relationship is firmly
established.
" '*
Inter-American finance and
;
commerce.
trade-retarding controls,
satisfactory plan finally
a
'is evolved.
•
Bank's
>,V"
:
hopeful that in the
am
j to come
Of
some
our
years
neighboring
■i
;
•countries will'be able to work out
broader
a
•
fiscal
•
foundation
revenues
so
for-
to
as
placed upon
,
•
products,
their
eliminate
the excessive duties that
•
are
now
imports of essential
such-
foodstuffs
as
in
;some instances. It is perfectly obvious
•
that
flour
on
if there is
in
areas
100%
a
where
tax
flour
is
greatest needed, that tax
acts
as
brake
a
on
merely
improvement
in the standard of
living.
trying to appraise the vari¬
types of financial operations
which may be necessary in our
In
SINCE The National City Bank o£ New. York established its
ous
inter-American
-
relations
in
first
the
banking organization has been concerned with financing the
production, manufacture and marketing of South America's many
I am inclined to make
three general classifications:
1.
first
The
enterprises
started
.
•
•
of
new
will
be
raw
private
business
financed
with
private
I hope and believe that
funds.
materials. It has
played a continuing part in the program of
supplying and adapting modern machinery for efficient development.
National City officers and staff have been
impressed with the
•
by
alone,
:
consists
which
branch—in Buenos Aires in 1914—this world-
overseas
wide
•future,
this will comprise by far the
largest classification. : An ex-;ample would be the develop-:
seriousness of
ment of
of international financial
their
•
•
v
food processing plant
in a situation where private en¬
a
terprise, is
/'"venture
..
{.
•
the
"''7'
second
projects
includes
financed -by
•
from
American
be
American
would
will be
had
are
glad
to
and
customers
long personal experience in Inter-
assisting daily in furthering the sound
consult with
They
;7.:,>;..;7
you.
governments.
require
INTER-AMERICAN
would
ARGENTINA
Buenos Aires
capital
and
BRANCHES
large
a
governmental assist-period of time until
the stage of profit-
of
amount
problems with the Bank's
have
banking and
example of this type would
a
hydro-electric
project
which
men
establishment of commercial relations between the Americas.
private
some assistance
United States and/or
the
These
responsibilities for sharing their knowledge
"V
new
capital but with
An
-
that
.v
The
South
1
*
will prove to be profit-
able.
2.
•
confident
friends.
BRAZIL
CHILE
CUBA
Caibarien
PERU.,
.
-
Ponce
.
.
..
need
some
ance
for
a
;
it
:
reaches
r"V •Santos-
able operations.
CBuenos Aires)
Plaza Once
3. The third includes
projects,
.
not
•
•
appropriate
for
develop-
men!
by private capital where
financing alone
necessary.
Examples
would
be
drainage
projects,
Janeir9
.
.
f Buenos Aires)
Rosario
Sao Paulo
CANAL
Valparaiso
Cuatro CaminoS
(.Havana)
r
Cardenas
Havana
Santiago
Pernambuco
r,
COLOMBIA
ZONE
Balboa
Bogota
Barranquilla
Cristobal
Medcllin
Galiano
v
Manzanillo
Matanzas
Santiago
(Havana)
La
Lonja
(Havana)
MEXICO
Mexico
City
Lima
PUERTO
San
REPUBLIC
RICO
Juan
Arecibo
Bayamon
Caguas
Mayaguez
.
;
PANAMA
Panama
URUGUAY
Montevideo
VENEZUELA
Caracas
would be
clearing of lands, and the open¬
ing oL
.
,
ment
in
new areas
to
which
create
THE NATIONAL
govern-
action must first be taken.
order
under
where
66 Branches in Greater NewYork
CITY BANK OF
individuals
and
private concerns can start new
activities.
MEMBER
NEW YORK
Head Office: 55 Wall Street
Co rrespondents
conditions
FEDERAL
DEPOSIT
INSURANCE
CORPORATION
/.
OF
government
•
;P
National City's correspondent
future of Inter-American
com¬
prehensive plan of post-war monetary stabilization and the elimina-
•
re-affirmation of
••••
this
are
embassies of trade, serving
•
opportunity to join with the other
countries of the world in
latest
throughout the Americas,
de Janeiro Branch is
the
the Americas should embrace the
•
Branches, strategically located
old
year
Rio
been
accumulating holdings of gold and
foreign exchange, the nations of
.
home of National
new
City's twenty-eight
automobiles,
refrigerators
and
other
(Continued on page 1208)
since this kind of collaboration is
the field of investment cap¬
the:
for
credit which has stood
the test of good and bad times and
has stimulated large scale
produc¬
ital, involving stock participation
and long term
loans, the supply
ably will
During the
consumer
to
•of accumulated local
•
con¬
credit, which
on
rountiies of that
expansion than to
I
which
past thirty years we have devel¬
oped in the United States an ef¬
are going to
get out of it,
long-run test is that of mu¬
benefit.
type of financial
one
is wholly in¬
adequate in South America. That
we
the
tual
capital
the
contributions
toward
country where it is to be
started.
the
I
is
is in the field of facilities for
development of projects where
ganizations;
In
all
ventures our
financial, technical and man¬
where a group or individuals from
ufacturing assistance are not re¬
this country is making a South
quired.
We must -pay more at¬
American ,i investment
spirit of mutual confidence and
mechanism
own
not
development of
cooperation exists.
Much
the
or¬
the
opportunities
which
South America, progress
will be retarded unless these basic
factors are really understood and
country during its
pioneer period was financed with
the help of foreign capital.
the
industrial
or
reasonable
in
States, I favor joint part¬
commercial
or
for
many
exist in
great expansion of trans¬
portation facilities and industries
fro.m the standpoint of
as
the
the
of
coun¬
nerships and stock participations
south of us, there are certain fun¬
damentals which should be clearly
stated.
right.
are
;V,
interests
United
the
to
v;/
and
our
the
possible
future
essential
the
ownership of
enterprises should be
purchased by the citizens of those
Both from the standpoint of the
other
Americas.
the
of
more
these joint
those conditions capital will seek
investment at normal rates of in¬
The management of
Export-Import Bank has been
intelligent and farsighted,
The
bank
has
not
squandered • our
money.
It has co-operated with
American industry, and has been
tions.
In
political
conditions
ably stable, where the past record
is good and where the
prospects
place, finan¬
cial assistance from private sour¬
bulk
of ces in the United States can lie
whose funds belong to their de- obtained
only on merit.
I know
positors, should confine themselves of no magic credit formula. Longto
commercial banking transac¬ term capital will flow
only into
these
-
south, of
where
areas
economic
have substantial, long-established
1201
Everywhere
THE COMMERCIAL & FINANCIAL
1202
There
long
so
the
To Create Posteither to thus destroy the
such, and paid as such, to be re/
newed, extended, and refunded
from" time to time, as the needs of
our Government require—but also
peoples'
savings or to create a higher price
level which will prevent an in¬
creased industrial output at home
and render us noncompetitive in
the markets of the world."
4
ul¬
regularly reduced and
timately paid."
be
to
as
tion and
lar to the
that
idle investment dol¬
prosecution of the war.
In all the confusion of post-war
He advised liberal
leaders in in¬
sons—so
our
continent
there will be no question as to the
dedication of every material re¬
shed
at
source
every
on
the terrible conflict.
is proud of its Army
Navy.
They are finely
trained and ably led. Their equip¬
ment is superb. Our military lea¬
America
and; its
1930.'.
;-yL.V,v
couldn't
we
of $66 billion a year
for the
last 20 years without its being in
debt $50 billion when our war
preparation began, it is evident
the
either
be
must
income
maintained at high levels,; or ex¬
reduced—both, in fact—if
penses
our
problems which the re¬
sulting* debt will create for our
nation, and that, every citizen for
Strickland
labor
termed this the
and
every citizen
"Otherwise
must meet and solve:
we
shall
meeting
achieve
be
;
it
honestly
by
insolvent;; only
' can
tbat for which
It must not be done
to come will*share its
century
a
It
consequences.
is
therefore
we
we
fight.
by inflation,
a
high duty of the American Bank¬
ers Association to promote discus¬
sion of the debt and its attendant
problems and to advance plans to
meet them. Such discussions and
dissem¬
should be widely
inated in simple form.
challenge which, government, in¬
dustry,
it is
plans
debts.
to pay our
are
likely that 99%% of
citizens do not comprehend
But
the great
support our
Government out of an annual in¬
"If
Mr.
renewed, extended, and re¬
time to time, as the
funded from
needs of
Government require
our
—but also to be
a
continued
ing, "I have never even heard the
matter'discussed." If that state¬
first to
roof of /a
and
walls
national
for
world
security and
ment,/ implied van
which
the founda¬
the
peace
of
tions
rear
post-war
our
//./
cannot; support,
;
economy
'
- <
/
<
indifference to
obligation, or an intent to
avoid
the
responsibility of the
be
would
debt, / it
alone. authoritative voice
It ;is .shared by every man and definite assurance
-woman jn America,
and literally collectivist notions
by generations yet unborn. The ated in America.
Others of these
traditional responsibility of bank¬
It is not oui; responsibility
1
well that ap
be raised with
that no such
,,
,
will be toler¬
' f
theorists have
revived such fallacies as a 30-hour
ers
is to invest in sound obliga¬
tions, and to safeguard ..the,funds week. They have reverted .to the
of their customers. To these duties .arguments used in the depression
to support the sowe
must now add that of wise mid-thirties
create
to
counsel
sound
a
omic atmosphere for Our
future.
To do this
we
"emergency" measures qf
work" and "share-thework" to .meet the- then existing
called
econ¬
"spread
nation's
must aid in
.
symbol of Governmental financial
integrity, was last in effect in
we
the
shelter
.
•
that
To be
We must not plan
world.
build
has planned wisely and
executed
splendidly ..the/ initial
phases of the conflict./We may
well heed their informed warning
dership
..
come
misunderstand¬
no
regularly reduced
industrial: and ultimately paid. But it is not
progress. Such a structure on such reassuring to hear of a highlya
foundation,' alone can validate placed Government economist, on
the guarantees of the Four Free¬ being asked as to any plans being
doms, either at home or in the formed to retire the debt, reply¬
whichto
on
of
structure
dustry and a new and constructive
Analyzing the ability of "U. S. A./ leadership in labor to meet in a'
Inc.," to
service an estimated spirit of cooperation and denounce
$300,000,000,000
debt after the the efforts to separate-. them in that great casualties, great effort;
their
common
purpose
and in¬ great costs lie ahead. •
war, he said that whereas national
income averaged $86.6 billion for terest.
f/y;.
'X
Happily, every portent of 'vic¬
the 20-year period from 1919 to
Mr. Strickland's speech follows: tory is ours. The matchelss .cour¬
Can a national debt of 300 bil¬ age of our armed forces, supported
1938, it has materially increased in
the war years, and the forecasts lion .be paid? Will this huge ob¬ by the outpouring of our nation's
for 1943 range up to $140 billion.
ligation be met in dollars of a wealth and the production genius
"Even this income hasn't been purchasing power comparable to of industry and of labor, are "guar¬
These are antees of ultimate military and
sufficient to support the sort of that of pre-war days?
naval success.
•T
management — administration of the questions which thoughtful
government—we have had. U. S. Americans ask themselves as they v How soon that'day may come
is a part of the individual respon¬
A., Inc. has lost money in opera¬ consider the economic aspects of
sibility which each of us must ac¬
tions
The balanced budget, war cost and post-war recovery.
.
be
.
foundation
command to shorten
our
ownership, it is necessary
there
ing that the debt is a debt—to be
treated as such, and paid as such.
planning the voice of American
banking must be heard as the ad¬
vocate of those measures which
will
insure ay sound economic
long as
blood of American boys
warm
is being
(Continued from page 1190)
misunderstanding that the
debt is a debt—to be treated as
divert every
"cold blooded"
no
finance or economics
the drama of war and
claims
debt
no
be
talk of debt,
Bankers Must Lend
be
can
Thursday, September 23, 1943.
CHRONICLE
;
Only the need for such discus¬
justifies any individual in
presuming to present an opinion
on so
broad a topic—a presenta¬
tion made with full knowledge of
sion
the
phases that
many
explored
cannot be
briefly.
so
The • Brookings
bringing home to every American unemployment.
/
/'!/./'E////EEE://J; an'; understanding / of | what, this Institution said of it then, an<i
we at home shall plan
debt means in future American could doubtless do so with even
*
greater, assurance now;
,
t)
in the future the na¬ life.
j
reservation, on
without
cept
home front.
How well
to preserve
.
they fight' is
tional life for which
a
the
larger part of that responsibility.
we
as
groups, or as
will be
To June
war.
nation,
as - a
individuals there
we
to
no
V vV/,
place upon us.A
.-V
leadership■:.% which
proves inept,
expedient;', ory cal¬
culating; an industrial leadership,
which proves
selfish ;or. incom¬
petent; a labor leadership; which
proves grasping or venal; an econ¬
omic, leadership which proves un¬
able lo' cope with ;new and greater
problems; or a complacent citizen¬
ship—all of these will. be repudi-*
ated
by
the
scornful;: look/of
hardened young eyes whose real¬
istic observations of men; dying
political
have
given them;
a clear percep-;
values;—human arid; divine;
tion of
The "s p e c t a t o r," psychology
<
ing
had spent 110
:
rent
/
mates
debt/will
persist among us has
place in war. No amount of cheer¬
mean
pro¬
a
even
v
be
American
1944;
/ to come willv not tax
increased to one- production greater than in 1935,
national
j income we or even in the previous peak year
200 billion by July,
near
.If taxes
of
third
are
our
thd of both production, wages, and na¬
-year/' 1944-45/ : this should tional income of 1929, " Is America
reduce .borrowed) funds to less to be told then in the face of world
that 60 billion' for.thatj fiscal year; needSj and the great necessity for
and leave us owing about 265 bil¬ maintaining J increased/ national
lion at July 1,. 1945.
]
}-'■ J. income, that we are to work less,'
t/To this must'.be added. war end-: produce Jess, and remain solvent?
Rather must we, as bankers,'and
ing costs—the ^stabilization of lib-;
erated and, of conquered nations; as: advisers:to the managerial sys-/
should/raise near 50 billion in
fiscal
>
the
tern
cancelled
contracts
war
—
a
of
American industry,/point,
out
gradual demobiliza-;
costs/pf
tion, reconversion of industry,' of
no
termination
and
adjustment of
which
output,
,
Current esti¬
the
that
are
would
It
with full
employment; substantially below
/ the level Of 1929. ;///; •/.;/
EX \
Surely, no one will for, a mo¬
ment assume that the; need for
goods of all kinds for many years
the Third War Loan drive is com/
pleted this month.
out¬
an
to a diminished
production
demand.
ductive /
when
billion
165
will-owe
We
is
week
30-hour
The
cropping of the idea of conform¬
30
ignominy too
reproach too severe; for history April," 1945.% ;/%/
no
v.
for
billion
330
:
has appropriated
.Our Congress
billions. At cur¬
^spending rates • tfyese appro-;
great and priations will finance the war to"
avoid it
shall
If
v
to
both
labor
and
:
manage¬
in' a spirit) of serious and
sincere cooperation, that the pay-/
ment,
pure
ing from side lines or ; bleachers
guess of 50 billion more.
; : v. j ment of our debts rests wholly on
cain
discharge our personal: re¬
the maximum production of goods,■
A These- facts, - and ; the
many
sponsibility. As Citizens -w^ are
the establishment of new indus¬
available estimates of others, jus¬
justified in requiring -competent;
tries/the maximum individual ef¬
honest and economical admlriistra-! tify us in accepting for this disficiency in both management and
tion of the entire war effort., We cussion a peak debt of over 300
labor, and the restoration of our
billion; / Should
the j ; war
can with equal right demand the
end
Government to its historic role of
elimination v by our Government, sooner the debt will be smaller—
an unprejudiced umpire.
;//;>>/ r:
if longer, an ever grater problem
of every
unnecessary) and non¬
More work, greater production,
.confronts us.
'
essential .activity. V We ourselves
j ' ' \ ' >
in our private lives must strip to
/.'This
stupendous
sum
dwarfs high pay to the efficient through
incentive
plans;
lowered costs,
essentials. We can do these things any
conceivable comparison
in
-
,
because it is
It
pricey down and aids in
essential
and
man-power
It
we
our
%/////X'''
is
this/right and; this duty
alone which our sons fight to pre¬
serve,
materials.
Government;
is
because / it
/, ///
Government.
helps keep
conserving
our
them
do
must
both
and
and for which' we pour, out'
the anguish of torn hearts
substance
the
of
our
•
econ¬
omy.
It
provides fighting dollars for Uncle
Sam
through the purchase of Govern¬
ment Securities
it
gives
you
a
by the Savings Banks.
spot-cash reserve plus
war, when spending
J will
help prevent post-war depression.
interest, after the
It has been recently said that
"the
State
is either all of us,, or,
politicians then in control."
In
bankers, a-most
important sector of war-responsi¬
place
our
as
bility must be met. Second only
military operations and indus¬
trial. production is the financing
to
of
war..
It is
a
responsibility ade¬
quately met by bankers through-out
the
shining history, of our
From the devoted service
of Robert Morris in the American
WITH
:$5
TO
Revolution, in patchwork borrow¬
ing to, keep Washington's tattered;
legions in the field; through every
war of our national life, the role
of the bankers has been an im¬
$7500
*
portant one.
BUY
WAR
BONDS
This
TOO!
.:
'
'
responsibility will greatly
.
surpass
during this war, and in the
period, the challenges
banking system has
faced after each previous war in
nation's history. During the war
post-war
THE DIME SAVINGS BANK OF BROOKLYN
DE
KALB
AVENUE
Bensonhurst:
86th
AND
Street
FULTON
and
Flatbush: Avenue J and Coney
BROOKLYN, NEW
19th
STREET
Avenue
Island Avenue
YORK
U
literature
affords
omics
The current lowering prices, wider distribution
of goods; economy and thrift by
econ¬
finance; and
of
the -.opinions
this /
volume
unprecedented
credit
create
instruments
new
-
will
/"functions
of
of
of
itself
credit.
the cloak of virtue.
of
a
standard
The perpetual
constantly enlarg¬
which"
our
of post-war Construction!
of non-revenue producing public
program
works, and world rehabilitationfrom the endless coffers of rich;
America—the coffers of continued
ing its debts/from
our
the profits of
industry, will have; littje labor and;
scant credit to'spare in such non¬
I
productive work.
/-Finally,
prosperity
that there
owe
can
.<</■
these proponents
through debt tell
is
no
living; / these ; alone
tion of
democratic form of gov¬
a
for/our
ernment
enable
will
alone
nation;//these
us
to meet our
responsibilities.; r \
international
-/There is no reason to doubt the
of such .an effort^-
sure/success
of such cooperation between man-«
needs
dependence
jects.
American
of
Is not
profit
system
proven
enter-;
superior?
us
doctrine
Such
a
our
of
program
mean
a
enterprise and
industry
thus
is not easy.
return
lessened
It
for
and that the capital, in keeping with the low
obligation to repay
which it takes from its sub¬
no.
With more than one-third
direct owners of
money
and
rates
which
retirement
of
the
the
service
huge debt
requires.
In the presence of these
economic
perplexities, and in the
face
of these erudite
but
untried
obligations, and
countless other
million indirect theories, it is perhaps unwise to
oversimplify the problem.
owners as holders' of life insur¬
Is the obligation of the United
ance
policies, of bank deposits,
(Continued on page 1204)
and other evidences of participa¬
nation. We must
Gov e r n m e- n t
•
this recommend the historical in¬
only be supported by the colwill
that all property
State has
Is it bethey
have created what
have been unable to do? Does not
lectivist theory
belongs to the State,
support from us?
we
cause
of prise?
debt because we
if to ourselves. This
of our citizens as
obligations of
of
|
aid in financing the
war amply and soundly.
We must
keep our banking structure free
of speculative credit, and; invest
largely in the short term,, low rate
economy,
f.
will pay our national/debt; these
alone can-guarantee a continua¬
/
that
our
profits, and
agers and workers.
We are now
V
•.
j /■;/.' :
A dynamic, expanding America] engaged in helping all the world
with its problems, and; rightly, so,
industriously returning to peace
for they have become our own.
time production of gopds through;
enterprise and initiative and pay-; Why is it the world wants and
borrowing.;
must, in collaboration with the
Government, and other groups of
we
alike;
citizens
industrial
expansion from earnings/balanced
budgets, *// decreased
borrowings
and
debt
payment—these/ and /
these, alone can maintain a sound
sustained
Borrowing interminably assumes
existence
and
Government
of
theorists who believe that
many
ing debt becomes, a guarantee of,
if it is created as separate- and
apart from us, it is only the device; security. ' For,'fear:. w'ej shall havri
too little debt we are to have a
of the
nation.
ACCOUNTS OPENED
economic experience.
,
.
•••
Volume 1158: Number; 4214
As
our
armed
give them
forces
our
fullest
by providing funds to;
guns,
sm^igh
against tine
we can
measure
pay
do is
of support
f As to its own
Insurance
"All hew
.»
f'mja. !»**•..
'oth
it
t
j life*
ft.
all other Americans have been
you
and
asking for.
September
our
—i
premiums collected
OVER and ABOVE
hoping for
But Invasion requires
And
-
gross
to say that
being invested in War Bonds—'
ernment
lot of money;
now
a
bond
its)normal. gov-
purchases "
in this month of
Government is faced with
colossal task of
borrowing 15 billion
dollars in the 3rd War Loan. As individuals
all of
can
j
participation, The Home
by The Home for the haldnce of 1943
tanks they need.
are
the
jiaifci* 4ft.ft
Company is glad
for the planes,
Remember, this is the Invasion
and
..>j
THE COMMERCIAL & FINANCIAL CHRONICLE
Fortress of Europe, the least
to
i,
us
must
spare,
■
/
will
^
:
invest
not be
-V'M
mi.::
MBMlmm
to
the limit —all
enough,
..NEW
we
f I RE
'.i'Sv
★.
AUT 0 MO BILE
YORK
★
MARINE
\ NSU RAN C E
A
•
*
•
For
tions.
Bankers Must Lend Wise Counsel
To Create Post-War Economy
(Continued from page 1202)
States
follow
us
in
Let
Will it be met?
good?
formula
credit
old
an
examination of the charac¬
an
ter, capacity, and capital of the
borrower—"U. S. A., Inc."—a bor¬
would
no
of
10
in less
understandable terms with copi¬
ous
qualifying footnotes.
But,
broadly speaking, such a balance
sheet sets out the present situation
years
of
peace—we
spent more
we
than
well
the most momentous
prove
's
of history.
and
capital
budget,
couldn't support our Gov¬
ernment out of an annual
income
for the last
its being in debt
of 66 billion per year
,
20 years without
50 billion when our war prepara¬
borrower, needing
the
due
■
.
will
ratios
The
S. A., Inc."?
record? How
of "U.
What is the earning
a
increased assets.
■; •
,
character, capacity,
What is the
of
get
thinner; if
proportion of current debton
demand or within one
increased as
materially
year—is
debt.
good is the management?
How
This seems to wholly justify the
dependable is the moral risk?
policy of placing all
To determine capital let us con¬ Treasury
struct a fictional balance sheet. bonds possible in the longer mamove
we
"Fictional,"
not; -because
it is
unsupported in fact, but only be¬
cause it cannot be wholly inclu¬
sive of either resources or liabil¬
to a 300 billion
up
turities, holding short term debt
service, apart from retire¬
initially will be about six
The activities of
Government for other than
and debt service for the fiscal
Debt
ment,
billion annually.
the
.
war
1943 cost four and a quarter
If we retire three billion
billion.
of debt yearly—a
tization plan,
increases—do
100-year amor¬
without interyehingj
notincrease
our
and keeping
;
physical
Our
about
worth
properties
,
400
billion,
are
using a
wisely designed in the interest of
the banks and the public, as well
equipment to protect it total 450
convenience. Nor
have full control
of this policy without the support
of the banks, not only in promptly
and
cheerfully
accepting their
quota of short term debt at low
rates, but in extending themselves
billion.
to the utmost in
average of academic and
Government studies.
Salvage of
rough
plants,
merchant
marine,
navy
and army; equipment and
material may run up to 50 billion.
war
So
productive plant and the
our
Our
;
■
current
including
assets,
deposits, currency incirculation,
receivables,^ inventories, and our
savings
in
Government bonds,
aount to about 225
billion.
Against this we now owe about
110 billion in private debt, and
170 billion in public debt, Federal
and municipal—a total of 280 bil¬
lion. Of this, 100 billion is current,
and 180 billion long term debt,
v
the Treasury
as
will the Treasury
vestment
of
inducing the in¬
every
idle dollar in
their deposits into a Government
obligation of appropriate maturity
by the owner of that deposit.s;
So we have a full debt and ex¬
tended balance sheet now. It
become
more
further
into
collect
more
so
the
as
progress
we
war,
will
but if we
taxes, begin to exer¬
surprised the world by speedy
to armament produc¬
tion.
We have designs for a lot
We
mark, that
of
down
failure
v
the
in
weakness
severe
paid
as
credit risk.
our
than three times as great
1929 budget,
as
our
and nearly twice as
great as our average 1933-37 an¬
nual
budget.
V
of "U. S.
A., Inc."? Is the willing¬
intent ; to
repay : the.
a
obligation present?
Has our re¬
to work on as soon as this war spect "for the promises men live
business is over. And a lot of new by" been impaired by a generation
customers to sell things to at a of political management,—-by na¬
tional repudiation at homeland
abroad?
Or
by the speculative
Labor?
Splendid, most skilled
and efficient in the world. In fact, orgies of the business and banking
communities in 1929?
Or by the
almost the only free labor left
character weakening subsidies to
in any nation.
By and large, the
favored pressure groups'??Has our
worker has been a full partner in
the industrial miracle
which is vaunted "standard of living" in
u
America.
His share has brought reality softened Americans?
„
of
things at' low prices and
lot of ordeYs banked up to go
new
him
in
greater portion of comfort
a
life
of
and
unlimited
oppor¬
known anywhere
Certainly this well-
tunity than
in history.
ever
being is nowhere else evident in
today's world. The path from the
bench
has
lathe to the "front office"
or
short one foY
the industrious.
Management in
America is just another form of
always been
and
ness
labor—with
than
not
efficient
or
store
a
skill
more
often
gained by capable and
labor in shop or factory
"tax
or
on
the farm.
/•/'
take" of the Federal
Management
.
.
Is the idea to be perpetuated in
America that any one who earns
his
way
honestly and who by
thrift achieves more of worldly
success
than
his less provident
/
must have
•'
neighbor,
thieving?
Here
a
and
labor
in
Government averaged four billion America, with few exceptions in
for the fiscal years 1930-39—pre¬ management, and a few in labor,
largely confined to leaders per¬
war and largely depression years.
This was about QV2% of national petuated in power by undemoT
cratic processes, understand each
income. Consequently it is evident
other.
Whence, then, comes this
that event a 15 billion post-war
claim of divergent interests, this
budget taking 15 % from a mini¬
rash of labor disputes, this alleged
mum post-war national income of
distruct between these partners in
100 billion will more than double
American enterprise? Why should
our pre-war tax take and will re¬
it
now
plague and retard our
quire a 50% increase over our
united effort in the most crucial
pre-war national income.
I.
hour of our history? The answer
This lis the challenge govern¬
to these questions has an impor¬
ment, industry, labor and every
tant bearing on our credit analysis
working citizen must meet and
conclusions/
„y ■■ A.
solve—otherwise we shall be in¬
The
a
capacity
What about the "character" risk
conversion
and hold down bor¬
rowings/ it need not become too
Its origin is clearly and unde¬
Our current ratio is about two extended, if the war doesn't last solvent; only by meeting, it hon¬
estly can we achieve that for niably in a class-conscious Europe,
;■ V"
and one-fourth to one; our net too long.
built on artificial distinctions of
which we fight.
It must .not be
What about the earning record
working capital about 125 billion,
done by inflation, either to thus birth. From it we have imported
and we have a plant debt of 180 of "U. S. A. Inc"? National income
these
Marxian
doctrines
which
billion against a 450 billion book averaged 66.6 billion for the 20- destroy the peoples' savings or to
create a higher price level which there had fostered the very total¬
value.
;
year
period from 1919-1938.
It
itarian regimes, collectivist
will prevent an increased indus¬
and
;
Against total capital resources hastjnaterially increased in the trial
output at home and render fascist alike, whose slimy grip on
of 675 billion we owe 280 billion war years, and the forecasts for
the freedom of individual man, an
us non-competitive in the markets
and have a net worth of 305 bil¬ 1943 range up to 140 billion.
America made strong by the dem¬
of the world.
/Olion.
V
Even this income hasn't been
Next the question of capacity ocracy of free men, now helps to
L
Economists, statisticians and ac¬ sufficient to'support the sort of comes in for consideration. How break.:
of well are the industrial, commer¬
countants alike will shudder at management — administration
Liberal leaders, in industry, and
this
scrambling of public
and Government—we have had. "U. S. cial, and agricultural departments a new and constructive leadership
private assets and debts,
and A., Inc." has lost money in opera- of "U. S. A., Inc." operated? Are in labor must meet in a spirit of
the
engineering and production cooperation and denounce this ef¬
them in their
methods okeh? Is the labor, situa¬ fort to separate
tion satisfactory? Are there good common purpose and interest. For,
rest assured, when our national
markets for the products?
cise economy,
debt is paid, it will only be
by the earnings of free men, in
both
management
and ' labor,
working as a team. If this is not
accomplished, we are obliged to
..
year
or less of the total,
other expenses a single dollar, and
the banks open to re¬
maintain our naval and military
volve this short term debt at low
establishment' on as low a basis
ities. But it will serve to illustrate fates to maintain the liquidity of
as two billion annually, we shall
how we and our Government look the Government bond market. The
have a minimum annual budget of
in the conventional form of finan¬ banking system can have no quar¬
more than 15 billion.
This is more
rel with such a policy which is
cial data.
•; .■•■■■
'■■V: •
•1 •
one-third
to
the finest facilities in
we
balanced
The
tion began, it is evident that either
in the near the income must be maintained at
obliged to have much greater fi¬ future/: additional loans of 125 high levels, or expenses reduced
nancial support in the months of billion or more, only a moderate —both, in fact—if we are to pay
part of which will be reflected in our debts.
war remaining—months that may
'
and
heavily,
owing
now
rower
Certainly the plant is: modern—
the world,
.
have unimpaired by the destruction of
war,
as
are
some
competitive
symbol of governmental financial plants. Managerial methods, en¬
gineering, and production super¬
integrity, was last in effect in
vision are the finest ever on earth.
1930.
?
SY'V'.v
have
earned.
If
doubt rewrite it
13 consecutive years—
them
Thursday, September 23, 1943
FINANCIAL CHRONICLE
THE COMMERCIAL &
1204
find
we
done so by
/
weakness grow-;
a
ing out of the vicious class
chology created in scarcely
than
decade
a
America
in
psy¬
more
where
has always been able,
worked, to stand on his own
two feet and look every man in
every man
if he
the eye.
willing
bore
What he; wanted he was
—
anxious
malice
him
to
He
harm.
no
with
ulated
earn,
to
—
no
He
who
did
man
inoc¬
not
was
class-conscious¬
the
which his forebears left be¬
ness
hind in Europe.
His was the right
win; to love and
to live; to demand and receive the
and
work
to
to
greatest freedom the common man
has achieved in all history. !
With the importation of collec¬
tivism,
of
prostitution
the
this
freedom of the common man be¬
gan
in America.
Groups were or¬
ganized to bargain their way to
positions of overlordship, and thus
the
become
to
of
means
seeking
to overthrow the democracy
individual.
May
pray
we
of the
that in
,
BONDS
WAR
BUY
the white heat of
American
the
courage
to stifle in our new
purchase 3rd War Loan
safest investment in the world.
Bonds—the
•
•
Ward, Gruver & Co.
©
Members New York Stock Exchange
MAIN
40
BRANCH
OFFICE:
131
EXCHANGE PLACE
NEW
YORK
Telephone:
Telephone:
YORK 28,
V Have
here
us
2-5600
RAILROAD STOCKS-BONDS
GUARANTEED
The Officers and Directors
New
*
.
York
Wish to extend
express
done
For
MEMBER
FEDERAL
DEPOSIT
view of
50 Broadway
excellent.
"U, S. A., Inc." is
a
solvent, well-
established business.
Its record of
New York, N.
Y.
ical
management for
years
The polit¬
the past 25
has
been shortsighted; its
policies for 13 years have
expedient
and
makeshift.
fiancial
Surplus
$3,225,000
SYSTEM
INSURANCE
credit analysis summary
growth is remarkable.
jersey.
FEDERAL RESERVE
our
our debts, both public
private;
earning
record,
spotty;
financial
management,
poor. Capacity—splendid; charac¬
ter, fundamentally sound, but not'
yet alert to common danger. Pros¬
pects. with better management,
banking.
Jersey City. N. J.
MEMBER
must believe
indifference to
sections of our
we
and
William J. Field, President
$3,400,000
part
and
;
Commercial Trust Co.
Capital
who
people is only because they have
been thoughtless and neglectful of
their duties, and forgetful in a
bountiful America, that the price
of liberty is eternal vigilance.
And so we must judge our na¬
tional character risk in the light
of pioneer bravery, revolutionary
valor, creative genius and inher¬
ent capacity for cooperation and
neighborliness. -
in
by the Association in the
of new
our
the apparent
So
appreciation for the work
,-
but an
those
might well run—capital, adequate,
but
needing careful husbanding
greetings, and to
interest of sound
of
in reality seek the overthrow
destruction of democracy.
of this Bank
'V/.;/'
/
Broadway
America never
effort
Underlying Mtge. Railroad Bonds
55
4
an
class-conscious, is
this threat by large
Minority Railway Stocks
f; i
at
that
Reorganization Railway Bonds
country,
our
these views been accepted
home?
No true
American will finally charge his
fellow citizen with this; opinion
without ■; overwhelming proof of
such an acceptance.
Rather we
must Dclieve that the expression of
by
V
N. Y.
SAcramento
into
themselves
economic life of
Lease Line Railroad Securities
•
OFFICE:
EAST 86TH STREET
NEW
N. Y.
2-1340
5,
HAnover
Guaranteed Railroad Stocks
•
Associate Members New York Curb Exchange
who have insinuated
the political and
telligentsia
unsuccessful
Specialists in Railroad Securities
generation the
unjustified results of prejudices,
sponsored by the: collectivist in¬
before
services to those desiring to
the souls of
dignity of a man of
and of integrity, and thus
realize
these views in
Stock Exchange we offer our
As members of the New York
war
boys will be made to
CORPORATION
been
With
a
fine record for
150
years,
however,
and
great
resources,
vitality,
and
opportunity,
and
(Continued on page 1206)
******
!■«''
,
Volume 158
.
THE COMMERCIAL & FINANCIAL CHRONICLE
Number 4214
*
VW.
ptt
After the
is
war
decisively won...
what kind of world is essential for a
This
question is being asked today everywhere in the world.
No expert
It
just and durable peace?
must
is needed to tell
be
town; a
world
a
as
you
the
answer.
•
peaceful and neighborly
world in which decent people
can
as your own
bring
up
their j;-
-
'
children
decently. It must be
and farms
How
way
are
can
is
cussions
busy world where factories
working and where there
such
to
a
world be
a
are
jobs for all.
brought into being? The surest
think and talk about it. Full and complete dis-;
on
the
porches of this country,
over
its fences, in
churches, schools, clubs, and always at meals—that is how
,the.
of A JUST AND DURABLE PEACE can
terms
formulated.
:
In your
,
-
discussions keep in mind this fact;
peace must
Only
I
your terms
be such that the people of other lands
with them. There
tained
begf
V':
must
of;
can agree
be provision in your plans for sus¬
production and for consumption of that production.
a
world
of good will
THE
peace
can
that
squares
be just. Only
INTERNATIONAL
a
with the conscience of
just
peace can
NICKEL
men
endure.
COMPANY,
INC
Subsidiary of The International Nickel Company of Canada, Limited
Uwi;';
New York, N. Y.
t—
1
Awarded to
Huntington Works
THE COMMERCIAL & FINANCIAL CHRONICLE
1206
Thursday, September 23,-1943
deficits
Bankers Must Lend Wise Counsel Paternalism In Government
To Create Post-War
vX'XX
(Continued from page 1204)
improvement on the part of
the management and renewed in¬
terest by the shareholders, it is a
fine business and ought to be pre¬
destroy the tax creating ability of
industry as will a continuance of
served.'
tions
tax,
sales
taxes,
with
'v.v/:;:
Can the debt be
paid? Certainly
it can be paid. The resources and
energies of the American people,
confiscatory income taxes into the
post-war period. Such a transac¬
thrift and
revivied
a
a
economy;
discarding of foolish notions that
dollar marks and price tags repre¬
sent a standard of living, rather
the
than
comforts
which
life
of
Production,
not
profits, must come first. Profits
in plenty for capital, management
produce.
we
labor
and
the night the
day."
that
It will require
allowed
be
file
and
politician
the
rank
citizens
of American
by
with the integrity of
our
national obligations, or
by
devices
to
control
production,
tampering
prices, or purchasing power a
single day beyond the period re¬
quired to reconvert industry to
,
time production.
peace
will require the substitution
It
civic
of.
It will
mean
and
will
mean
It will
of
maze
and
that
mean
X
shall have
we
democracy in all of our
hundreds of thousands of
require
re-examination
a
of large in¬
will be responsible for this
come
persons
It will be necessary
consideration.
for the Government to do so if it
is
to
receive
adequate
wealth
and
Business
revenues.
will
have
their
lost
capacity to produce
taxes if our present confiscatory
of
rates
taxes
power
income
continue
inheritance
and
to
destroy
is
the
likely that a gross trans¬
actions tax
the
from
bureaus
ernment
in
dom¬
inance of pressure groups, so that
all
citizens
may
obtain simple
the transfer of all
on
goods and services will alone pro¬
duce adequate revenues and not
the
of
reaus
pressure
Too
political
or.
any
fa¬
//;.'X,X'-'
;
criticism
often
of
influence
group,
vorite.
direct
your
not
ac¬
conclusion
action —in
suggestions are offered for
reflection and consideration.
far-
well-known
Policy," stating that after the last
our
velopment
not
financing
of
than any
in private en¬
terprise. It has a larger duty to
assume, the
initiative in devising
a
long range fiescal policy for
both the war and post-war period
in brder to assure our continuing
national solvency.
■vXXXX,X,:';3---:':
the
war
Pursuant
to
this
responsibility
it must give unrestricted
support
to the Treasury in the current and
in
future
war
loans,
advise
occasions
as
and
the
to
on
all
wisest)
most economical and safest course
of
financing to be pursued, with-
lUillllllllllllllllllillllilllllilllllllllllllllllllKIIIIIilllllllllillilllllllllil
Fhltm Twist Cmnet
OF NEW YORK
1002
BROADWAY
MADISON
Policy
suitable
staff
submit
and
to
(Bet. 77th & 78th Sts.)
(Singer Building)
the
to
studies and recommendations
con¬
cerning the fiscal problems of the
United
States
for
a
period of
years. Such procedure will afford
opportunity
seek
to
collaboration
cooperative
constructive
with
trial
production, general business,
agriculture, life insurance, invest¬
time."
banking, and organized la¬
and, finally, will necessitate
study of present and alternative
bor
a
of
taxation, tax limita¬
allocation, and
budgetary
ture.
X:V\.■:-X '''XXXXXtXXXX;'
systems
By
desire, and pledge
effort
to
office,
the
secure
particularly
of1
its whole
*
election
to
to
Con¬
our
pledged to serve
citizenship, and who
will
eschew
allegiance to
any
pressure group, or minority bloc.
This grave hour affords no ground
for self-seeking by any group on
gress,
men
whole
the
American -sense.
The United
States
needs a Congress; and an
administration of its Government,
now
and in the post-war period,
will
consider in fairness,
equitable solution for
the problems of every group and
seek
class
of
citizens, impartially
and without prejudice. Whether
we are bankers or laborers, farm¬
or
our
white
collar; workers,
unorganized, all of
right to be treated by
ment
As
doc¬
first
have a
us
Govern¬
our
one
writer has said
a
new
manciples
to
so
well-
honoring of
get back to
self-faith and to re-establish the
integrity
Edmund P. Rogers,
Morris. Chairman
peabody
America's
of the Board
charles scribner
'
Stanley A. Sweet
Johna.Larkin
Charles s- Brown
bernon S. prentice
o'd
Russell V. Cruikshank
franklin b.
e, townsend irvin
russell e.
lord
burke
stephen
c-
iselin
clark
do
is
of
pioneers.
the
a
a
Charles J. Nourse
ous
nil inn milium if iiiiiiiiiiiiiiiiiiiifiiiiiiiiiiiiiiiiifiiHui urn iiiiiiiiiu
head
citizen of
a
System and Federal Deposit Insurance Corporation
which
the .courage
courage
to
member of
De Coursey Fales
order
old
has
of
two
struggles
world wars have
thrust
into
us
a
positicn of leadership. It may be
true that this great responsibility
has
world
to
and
therefore
it
permanent
lasting peace,
trade,
prosperity
no
no
behooves
the bank¬
of this country, as
ers
experts in
these
matters
of
the peace.
I do not mean that we
should attempt to write the terms
of the peace
counsel
our
matters
but only that we give
and
advice
on
those
with which we are fam-
iliarihar by
croachment of government on the
' private enterprise system under
the
of our calling.
In order to be prepared to give
reason
in the
in m e n t
lending agencies. There is danger
of these becoming permanent.
X
This is. especially true in the
field of agricultural; credits.
Due/
to the long and deep depression
in
agriculture,
drastic methods
of
countries
several
the
so
that
of
emergency
in
of
gover
used to revive it
were
forms
various
and relief
adminis¬
was
tered.
Happily the patient has re¬
covered
and is in good health
should
in de¬
Therefore there
great difficulty
vising a program that will
the farmer all reasonable
again.
be
now
cial
no
assistance,
and
ensure
finan¬
at the
same'
time provide for a Continuance
banking in the field of private
qf
en¬
terprise, thus relieving the heavily
burdened Treasury of the neces¬
sity of providing funds for some
twenty-three lending agencies. To
clear
make
Association's
the
policy on this subject, after ap¬
proval by the Interim Committee,
the Agricultural Commission and
the Food-for-Freedom Committee,
I issued at St. Louis on January
20 of this year a
statement which
follows:
in pait reads as
We
recognize the right of farm¬
ol any other group to estab¬
ers
lish, operate, and maintain co¬
operative credit enterprises. We
believe, however, that such in¬
operated on
self-supporting basis and that
stitutions should he
a
should
.income
cluding
ing
be
adequate
to
the costs of operation, in¬
covex
this assistance I
have, with the ap¬
proval of the Executive Council,
appointed a committee of able
bankers; which is now at work
studying and analyzing the needs
guise
establishment
fi¬
and
money
to point the way for the.
Statesmen .to follow in shaping
nance,,
they
credit
losses
tions
of
should
out of the
Continu¬
losses.
any such institu¬
not be subsidized
Federal Treasury.
We ' believe
that
the
■
present
subsidies enjoyed by the produc-.
tion
Credit Association in the
may
of
a
are
family,
as
a
community, and as
stable and prosper¬
the essential
element
of the nation which will be pre¬
cisely what they
'
other.
are.
X
.
leaders
as
,
Let
their
in
communities.
after the victory the world
accept then this leadership
agairt to be a place where peace; and boldly denounce as unsound
those men and measures which
plenty dwell, we, as the rich¬
to
the
destruction of our
est and strongest of the nations, lead
American
must
use
our
wealth: and
our
economy,
and let us
If
us
is
and
strength to help restore the less
fortunate
We
countries.
should
be generous, we must be practical.
We can help the world back to
prosperity again
only if we use
wisely. To do this
there must be cooperatiori with
the other nations and especially
with
those
that
comprise .the
our
resources
British ' Commonwealth
of
Na¬
•'.X.;X'" x,XX.X; XX"" XX X-XX;.-'
tions.
.■
ingway's address
as
of Mr. Hem¬
President, we
^
quote.
It
seems
to
me
that
the
best
preparation we can make for the
future is to secure the recogni¬
tion
by
principles which will be used
as
our
fellow citizens of cer¬
criteria in the consideration of
question which may arise.
Among these are the preservation
of the. integrity of contracts, the
inviolability of the right of a per¬
son to own property and the pro¬
tection of .his enjoyment in its
any
the repudiation of the
principle that the government can
use,
and
create
wealth and
of
can
its citizens
again proclaim that, energy and
enterprise, self-denial and thrift
provide the only road to individ¬
ual and national prosperity.
.The
same
duct
for
rules that
of
direct the
better than
the
apnly to the
con¬
hold
true
individual
the government.
Neither can
waste money without
injury. Each
must live within the incofne pro¬
vided or in the end face disaster,
.X" during
From the first part
affairs
nation.
Men
Member Federal Reserve
To
tion, and a genuine respect for
the dignity of one's self as a man,
for one's own work, one's place
as
on nell
nation.
It requires sacrificial devotion,
spiritual and intellectual convic¬
Morris, President
Henry W. Bull
our
a
equivalent
Chairman of the Executive Committee
Arthur J
John D,
of
this, to turn our backs on polit¬
ical opportunists and to resist the
"inevitableness" of collectivism,
requires
Lewis Spencer
the
the
and
passed
of the rivalries of the
tain
free American citizens.
as
It will take
KOMI* OP limiCTOKS'
World
,
the
.
its
or
Personal IhinkiBiij
reason
Old
had
coupled
control, of
our
form
of
government
capital
recommend plans for
should be returned to the United
the stabilization of currencies, the
States Treasury, as soon as prac¬
where necessary;
destructive trends.
We must be¬ establishment,
ticable.
of sound banking systems and the
come active, constructive propon¬
This policy should be adhered
maintenance of an international
ents of a revised, sound financial
to.
;; XX-'XX'XX,,; xXXXX'X' xX '" ;
program. In such manner alone exchange ^ased on gold which
will assure exporters and import¬ ••v;We have been told on
can we meet the responsibility of
many
ers
everywhere a stable money, occasions that the bankers are
financial X leadership
which
we
so necessary for the free flow of
must now assert or abdicate.
looked to for advice and guid¬
goods from one country);to an¬ ance, and that they are regarded
This Association should record
Banking, cannot; be content to
serve only as opponents of current
or lawyers, business men or
politicians, and whether organized
Jliul
this
fail
not
.X. xX-;\ Xxx ;.,XXXXXXxxX
In his remarks in the third part
tors
Personal Trusts •
•
again oppor¬
door" and
our
of his report, Mr. Hemingway
the following to say in part:
ment
ers
5 m
at
"we" should
a
publish
prepare,
Treasyry De^
partment, and to the proper com¬
mittees of... Congress, 1 continuing
and
AVE.
"now
knocks
of the
which
Uptown Office:
Main Office:
that
that
come too soon, that we are not
prepared by either experience or
training to render the full service
the world needs from us today,
post-war planning Tor spending
but we cannot escape it.
Shrink
and
borrowing its authoritative
as we may, we must face the facts.
voice must be raised for earning,
In this great work that lies ahead
saving arid paying. If the United
of us a sound financial program
States cannot plan for the pres¬
must be the foundation on which
ervation and solvency of its own
to build the structure of peace
post-war economy, it cannot pre¬
and goodwill throughout the
tend to assume the salvation of
world. V; X
• VtX; X':"
'XX
the. world.
X X, XX;-X', ■■X- -; 'XXX. ■
Tf national budgets go unbal¬
In discharge of its longer term
anced and currencies remain, re¬
duty the Association should now
deemable only at the will of gov¬
establish, under the guidance of
ernment there can be no stability
its Economic
Commission
regard to any selfish interest
banking system.
In the midst of a plethora of
out
only has a greater re-(
control of Government in the fu¬
sponsibility
for
the
successful
other single group
tunity
XX "dX"''X^X,- X;X-"vX
1191)
page
bankers
failed to make the
America, particularly in the
banking field," he reminded the
our
1 4 f
their
diplomacy X'resulting in
Good-Neighbor
sighted
the
Hull for
Mr.
tion,
The American Bankers Associa¬
tion
and
leadership in the fields of indus¬
is
companied by specific suggestions
to earn, and necessitate the
virtual liquidation of growing en¬
terprises in each generation.
It
labor
productive
private industry.
■, ■■ ':XXXXr'X^X XXX;'
It will mean freezing all Gov¬
system of taxation. Neither
nor
for
leased
these
.
business
unneces¬
Government workers be re¬
sary
for
our
must
judicial bodies, without
prejudice to either employer or
employee.
XXX'X- XL;;:" '•X'Xv^X- X
It will require that all Federal
procedures be simplified, and that
cluded.
It will
boards
Labor
become
relations, labor organizations in¬
of
which will attract venture
capital, without permitting fraud.
the substance and not merely the
form
The Securities and
Exchange Commission must sim¬
plify its procedure, abandon its
inquisitorial methods, and pursue
National
declared, "is due to the Presi¬
dent
opportunity in the de¬
of trade with Latin
judicial interpretation become
Courses
credit,"
we
taxpayers restored. Congressional
intent must be more simply stated
less technical.
he
"Great
World War
Tax pro¬
cedure must be simplified and a
sense of fairness in dealings with
and
removed."
been
most of
to persecute.
cease
the other American nations have
XdXX'XX-XX-X
interference in administrative bu¬
a
interpretation;,
X'X '' ' '
:
must
that
v(Continued fr om
Government
retirement.
It
justice promptly, and without the
tice is not to be lost in
legislative
sophistry.
by
of
XX;'
'
with
be
for political
-X X ;■•'
'.".Xx
that elemental jus¬
integrity
trickery.
well
vice
The
•
no
defraud
to
"as
follow
will
alike
might
statute allocated first to debt ser¬
directed into channels of full pro¬
duction, guarantee the ability to
pay.
It will call for a renewed
valuation of the dignity of labor;
combination
in
Si Should Be Abolished
t
Economy
with
bureau¬
daily lives
people can only lead to
state socialism and dictatorship,
the very thing we are fighting
to destroy in other lands.
We al¬
ready have instqhees of the en¬
cratic
of
may
The
an
be
emergency
old
rules
temporarily
suspended.
depression
saw
the
great
abandonment of sacred principles
under the stress of emergency.
The
global
left us no choiqe
arming to win.
It fs
hoped that our youthful strength
and great resources will enable us
war
but that of
to survive these
two great
but
cannot expect
certainly
we
blows,
to
weather another emergency if we
follow the same course of ex¬
cessive spending and taxing..
*
And again let us
necessity
for
the
j
emphasize the
abolition
of
paternalism in government.
The
American people have always had
a sour, d government because they
were jealous of the power of gov¬
From the very begin¬
tnemselves can.
We know ernment.
ihat,
unless
these
truths are ning of our national life restric¬
tions have been placed about the
recognized by the great majority
of our people, the system of pri¬ authority of our elected officials.
But recently we have seen prac¬
vate
enterprise is doomed, and
the American way of life, which tically unlimited powers given to
has been the envy of the world, the Executive Department on the
will
be
destroyed
by
enemies ground that they are necessary to
meet
the emergency.
Granting
from within while we are fighting
to defend ourselves from enemies that this be true, it should be so
only during the emergency.
from without.
they
A
continuation
of
government
(Continued
on page
1208)
,
Volume
158
THE COMMERCIAL & FINANCIAL CHRONICLE
Number 4214
JLVJLissing in action." You know what that
can
mean.
"i
r
;Vt
*
father would expect
bedtime and your
can't
you
You've
in
a
telegram
1
\i
.
be brave. "It's what
starts to
,
your
feel shaky. Then
away
eyes.
let her
never
since that
*; i
i
-
hard and turns her head
her
see
\
of us," she tells you when it's
chin
she kisses you extra
so
•
,
Mom says you must
came
see:
you cry.
Not
once,
and she twisted it all
up
ball, then smoothed it and put it in the desk.
*
But, lying in bed, you play "Pretend"—pretend
hear his
you can
—pretend
he comes
step as
feel
you can
a
head. And sometimes, in the
smell
Later
your
dream—dreams that
you
about. And in the
guy.
something
we
face.
you
don't tell
morning you wake up with that
funny, empty feeling in
Poor little
fore¬
your
dark, you can almost
cigarette-y suit close to
a
up to your room!
stubble brush
your
stomach.
We—all of us—wish there
were
could do. Perhaps there is. Why
shouldn't it be this?
'
We
resolve that the
can
for you
plans your father had
shall remain within
shall have the chance
to
your
grow
reach, that
you
and learn, that your
opportunities will be bounded only by your
own
get-up-and-go, that you will progress and prosper
in direct relation to your own
of freedom and
Those
*
,
the
are
things
things for which he
strive
may
to
ability—in
your
gave
land
Dad valued, the
his life. Though
change all that—provide
the "benefits" of
a
opportunity.
some
with
you
all-powerful;government, the
an
"advantages" of regimentation, the "blessings" of
bureaucracy—we
You,
can
resolve they won't succeed.
won't read these words, and if you did,
son,
they wouldn't
mean
much
to you now.
But your
father's friends—known and unknown—are mak¬
ing
promise, just the
you a
You
may never
you were
older
same.
hear it from their lips. But if
you
would read it in their faces-
recognize it in their spirit. They are determined
to
keep America free. To keep it
government
a
land in which
is the servant, not die master of the
people. To keep it the kind of America your Dad
wanted
to
preserve—for
you.
''
i
yl':
Chesapeake
and
Ohio
CLEVELAND, OHIO
Railway
THE COMMERCIAL &
culation.
Paternalism In Government
J.
.•
;
,
'
•
1
1
•
•
'
(Continued fr om
-■
A
year ago in this building I
btated that we would support our
Commander-in-Chief to the limit
A glance at the
activities of the banks and bank¬
in the war effort.
is ample
with
ance
proof of our compli¬
statement.
In
that
have helped the
and we will
continue
to
assist
our
valiant
President.
Although some of us
are of opposite political faith, and
way
every
we
nation's war program
others of us have opposed many
of the President's - policies, never¬
■
theless
we
havewholeheartedly
worked, in the ranks with our
fel¬
Americans in furtherance of
his [war program.
Although we
have felt at times that the meth¬
ods; and measures adopted have
been ill-advised, yet we have, like
good soldiers, carried on.
We
have sold bonds/ kept books in
terms of sugar, gasoline, and other
ration points, and now we are
acting as tax collectors, all on a
basis of no profit to ourselves and
low;
considerable
expense.
obligation to serve does
not rest solely upon us, - There is
also
an
obligation binding the
often
But
-
permit men in his
take
of
advantage
emergency
not
administration
the
war
to permanently fasten
economy
alien to our
traditions. T think it
not amiss for
upon us an
also
see
great service not only to his own
country but to all mankind. ; Let
us pray that this opportunity will
■/;•£}
.
I also offered our
of the
Treasury in his task of financing
the war.; That offer was accepted,
and, as you know, our Association
has
worked
closely
with
the
A
ago
3 ear
assistance to the, Secretary
We have been glad to
of bonds.
render
service
this
to
gov¬
our
ernment and to our country.
we
have
a
But
further obligation and
insofar as in us lies
that the integrity of
the
government bonds is pre¬
served.
While we are prepared
that is to see,
the
power,
to continue to finance
matter how long
the war, no
Let
success.
conditions
The
boys on the
lighting fronts that, proud of their
courage and skill, we are fighting
What excuse can there be
the war for further
after
our
that they can count on us to
the attack
tory will
that
so
when the
have been
they will find
And
good credit, therefore are
able to pay for v/hat they want
and need.
Furthermore, and this
of
back
has been
brought
ing up of closer business and per¬
sonal
;
It is time for the people of this
our
for all,
bounties from the Federal Treas¬
to fight | ury, v/here the powers of local
this war, and if we are to have aj
government are no longer usurped
country to realize that we are by the Federal Government, in a
return to economic health it must
word, the kind of government
be by the orthodox way of work that
has
brought us to world
and save. And in addition to econ¬
leadership.
:
'
straining
resources
L'v.'
f
.
make the most of these op¬
To
portunities there must be free dis¬
cussion between the people of the
thus
countries
(various
i
opening
the different points of view.
irp
.
omic health if we are to preserve,
in this land the American way
life
that
our
forefathers
need
of
genuine
I hope this convention will make understanding of spiritual values.
Known in no uncertain terms that
We have been living face to face
the banks will not accept the re¬ with the fundamentals of life and
us
we
his
'In
remarks
Latin-
to
as
America in the second part
estab¬
following to
(
It
say
in part: >
conduct
can
unless
that
axiomatic
seems
we
of his
Hemingway had the
Mr.
address
a
affairs
our
What Is Ahead «#
In/The Americas?
at
(Continued from page 1201)
intelligently we cannot hope equipment is to be anticipated in
to gain success abroad, and I think South
America, then the facilities
it was clearly brought out this for
financing consumer credit on
after the war and another pro¬ certainly learned that man can¬
morning that the biggest problem an instalment basis will have to
gram of government spending is not live by bread alone.
facing us is the relation of busi¬ be greatly augmented. This is one
undertaken.
: Yv
A/;:/
V Any reference ,to the Treasury ness
to
government.
This also problem to which the financial
No one can argue successfully immediately brings to mind the'
extends into our foreign relations. minds of our
country and the
present drive for the sale of the
One of the most important func¬ other American countries might
that we need more money in cir¬
sponsibility for the consequences learning to appraise things at
if a third emergency is declared 1heir true values
and we have
home
■
of
duct of
ty t'imi
is the con¬
government
our
relations with foreign
Generally
countries;
speaking,
.
foreign policy has followed a
rather consistent pattern from the
our
which
of
regardless
beginning,
politic as] party was in power, but
present administration
were present
relations with the other
underthe
irritants that
those
in
our
American
have been
nations
^
re¬
Great credit is due to the
moved.
Mr. Hull for their
and
President
tar-sighted diplomacy resulting in
the well-known Good Neighbor
'V-y'-.y.'•'•'■"L
Policy.
that field
L In
between
We
but
and
figlit
not to
to set a
to
enslave,
free,
country
make
room
upon
must
tlie earth for bonest
men
oe
1
government and banking
wisely determined or. a
opportunity
to
develop
hemisphere solidarity may be lost.
Each has a place in any program
for expansion of our political and
economic influence, and by pull¬
together
ing
made.
great progress can
fact, each should
In
supplement the work of the other.
It seems to me that the division
should be
on
the basis of the char¬
of
financing that is to be
a purely political
nature or for military reasons it
acter
If it is of
done.
nomas
V.
■
the relations
also
great
be
should
left
be
solely
to
govern¬
well apply
approach to the further de¬
velopment' of commercial rela¬
tionships; among
the American
publics has been greatly assisted
by the establishment of the Of¬
Inter-American
the
of
work in
Both
are
of
of
hands
the
banks.
Naturally, it will be in the border¬
line
that
misunderstanding
arise and it is in the deter¬
cases
may
mination of those cases that there
is need for a
sympathetic under¬
standing and unity of purpose if
we
are
to get the best results.
Twice
before
we
have
had a
chance to improve our
trade with
but each
southern neighbors,
our
time
failed.
we
t,
to a closer re¬
with Latin f America
was
after the Spanish-American
War.
At that time' a great in¬
The first impetus
lationship
MERCANTILl
terest
Trust
Bank, and
Company
slouis
SAINT
was
aroused
to
develop
relations
with the other American repub¬
closer cultural and trade
lics, but it was abortive. Our own
affairs so occupied us
ing
we
did not succeed in meet¬
competition cf the great
-lire
European nations.
during
Again
the
last' World
War the
inability of the European
to
carry
on
with Latin America
a
D S Pps I T
larger
business
IN SURA hi Ct
CO »PORA ft ON
trade
their
brought about
with
us
after the war we attempted
Se^yflOi ft A t
and
to de¬
this business on a large
Again we failed to make
the most of our opportunity due
to unwise methods, quickly and
velop
scale.
avail¬
of bankers and
use
are
/L/Y/Y
men.
let me say that I
think it is highly appropriate that
In conclusion,
States '
bankers of the United
the
should post
themselves on future
possibilities within this western
hemisphere.
It might indeed be
a
helpful move if the American
should
Association
Bankers
inter-American division.
It is
give
organizing
to
consideration
an
;■
significant that this Asso¬
devoting an entire ses¬
ciation is
sion
convention
this
of
the
to
discussion of inter-American rela¬
tions.) That is more than a straw
It is significant also
distinguished
Canadian
in the wind.
a
with which
friendly
north of
the
to
enjoy
we
us
close and
so
relationship.
a
us
the
representing
session,
great nation
so
address
invited to
was
this
at
is
It
equally encouraging to have with
as
us
today
of
ber
the
Mexico,
at
speaker
guest
a
session
prominent
a
our
mem¬
banking fraternity in
our
neighbor to the south
which likewise is standing side by
side
with
us
the
in
grim battle
against the forces of the Axis.
/
The
ican
-
membership of the Amer¬
Bankers
Association
repre¬
sents more than a cross section of
the people of our nation.
sents
responsible
local
communities
type
of
It repre¬
leadership
and
leadership
it
is
in
that
which must
give impetus to the sound policies
nations
MSM
the
able'.for
business
The
Rockefeller/
A.
facilities of those offices
internal
that
under the able direction
Nelson
banker
the
that
Develop¬
Commission, which two of¬
close collaboration.
ment
fices
ular routine of business it should
in
Coordinator of Inter-
of the
fice
American Affairs, as well as
that
be
'
themselves.
The
ment, but if it falls into the reg¬
between the peo¬
relations
government is the servant
tions
t
first
the build¬
means
of its ples oi all the American nations.
people and not its master, where We will be drawn together m a
the bureaucrats no longer direct way never before dreamed of and
is important, there is a check on the lives of the
people by depart¬ a great volume of trade can and
these
expenditures because the mental regulations, where no class will be developed between na¬
people have to vote the bonds at of the people is soothed into obey¬ tions of this hemisphere which
an election
held for the purpose.
ing the planners in Washington by will result in greater prosperity
the road may be, lished for
K^v^^rssum
?
the
for
trade
of
This also
time.
boys home
our
growth in the pro¬
of products,
all kinds
of
of which will flow into the
arteries
and
hitherto '"undeveloped
resultant
a
duction
country where the
a
aeroplane now
inaccessible and
the development
very
possible
areas
with
that
won
be
to
some
determine
all
us
war
have
we
in
let
of the
use
makes
be won.
soon
let them be provided by lo¬
governments — state and
municipal.
These
governments
paying their debts and
used
glorious vic¬
a
different now.:
are very
puts within each reach places that
battle of the home front and
the
fail this lime because
should not
all redouble our
us
efforts and show
war,
cal
for the sale
Treasur in the.drives
portunity knocks at our door. We
chairmen,
committeemen,
salesmen, in fact in every capac¬
ity, to make this drive a huge
spending
to make
work and put money in the hands
of the people?;' The only reason
is that, of political expediency.
If
public works are needed after the
are
ioosely1 developed, particularly in
the banking field. Now again op¬
Bankers every¬
,
hard at work acting as
are
state
that government
politics is shoved into the back¬
ground.
For the second time in
our generation destiny has placed
a
president of the United States
in a unique position to render
hot be lost.
where
deposits today are more than 88
billions as against 56 billions in
then
him to
ask
to
Third War Loan.
outstand¬
The currency
ing exceeds 18 billions of dollars,
Whereas in the boom year of 1929
it was less than 5 billions.
Bank
1929. /
1206)
page
us
at
the
President, and that is that he
to
"
.
Should Be Abolished
''■/v'
ers
:
'
,
-
Thursday,- September 23, 1943
FINANCIAL CHRONICLE
and
of
wise
our
world.
financial
in
country
period.
We
selves this one
Hr>w
do?
the
We face immense
bilities and great
that
statesmanship
good
a
post-war
responsi¬
opportunities in
must
ask
our¬
primary question:
job are
we
going to
*
ii
Volume 158
•'
•■!"
■•'
'■
"
;■•]'•.
.:
v
'•' uV*>?';.;"'''..
']■■[■"■
THE COMMERCIAL & FINANCIAL CHRONICLE
Number 4214
prop
t;||
^
■
<i
ji
***» ®r ■% M
WM_: S^.JU&ssbs
Vv
*
*
,Vj|\
\v
1
FIRST it flies. Then it swims. And anything it
hits
boom!
\>
goes
.
<
It's Uncle Sam's aerial
torpedo bombers
are
using these days to deal out
grief to Axis ships.
'
Inside this "flying fish" is a steel lung,
-
,
torpedo. The kind our
full of
compressed air. When the torpedo is released, the
compressed air drives it viciously toward its target;::
A
special kind of steel is needed to make the steel
lung. It has to be thin and light to help reduce to
a
minimum the load the
torpedo plane must
And it has to be very strong—to
of many
sure
The
is
carry;
withstand air
hundreds of pounds
per square
pres¬
inch;
special steel for the lungs of aerial torpedoes
just
one
of the
many
developments that have
emerged from United States Steel laboratories to
help win the
war.
You've read about
steel springs
some
of the others: special
for torpedoes and bombs; portable steel
landing mats for bombers;
steels for aviation;
new
a
tin
plate, made with only a fraction of the precious
,;• t
r-v
tin
needed,
once
I
You
Will they
be
can
thousand
sure
*
-
benefit
you
"
t
ii"'
v
>»
»
»
•
>
*
.
after the war?
they will. For then the
new
steels
will be ready to serve you in a
peacetime products.. . from lawn mowers
inspired by
to
,.,
"-,*7t
f
war
'
,v
'iVi
skyscrapers. You'll find that the U*S*S Label
than ever on the goods you buy. And
means more
that
no
other material rivals steel in usefulness and
long-range economy.
\
.
/
/VSWS7EEIS
,wc
rx--
FOR 4MER/C4
BUY WAR BONDS EVERY PAY DAY
The money you
Yours
loan builds America's
again to spend in
years
strength,
war
to come
.
.
for
.
new
iiiips
comforts, products of steel, things for better living.
AMERICAN BRIDGE COMPANY • AMERICAN STEEL & WIRE COM.
PANY
'
BOYLE MANUFACTURING COMPANY
STEEL CORPORATION
FENCE DIVISION
PANY
•
•
•
FEDERAL
COAL,
IRON
&
ALLOY STEEL CORPORATION
COMPANY
•
CARNEGIE-ILLINOIS
•
•
OIL WELL SUPPLY COMPANY
RAILROAD
•
COMPANY
•
TUBULAR
UNITED STATES STEEL EXPORT
UNITED STATES STEEL SUPPLY COMPANY
SAL "ATLAS CEMENT
CYCLONE
SHIPBUILDING & DRY DOCK COM-
NATIONAL TUBE COMPANY
TENNESSEE
-
COLUMBIA STEEL COMPANY
•
UNIVER¬
COMPANY' .' VIRGINIA BRIDGE COMPANY
^ \- • :•
i't;iBrifi,!.,:Uii^ltd
^'-V't K>J .f"
<-' »'(•,>
*
.
!
'
•
•
,
i V
;
;
».
i
"
m
I..'."-'
'
,
1210
during - the because of the sharp decline: in
people the ratio of capital resources to
be influenced by demagogues or deposits, adopt an extremely con¬
Third, one may
misguided
advocates
of
new servative policy?
banking theories or of ways to expect that the volume of cor¬
liquidate the debt without the porate securities offered in the
payment of taxes. Education is a market in the post-war period
Will the
(Continued from page 1199)
powerful weapon and the people will be considerable.
at large should be educated and banks adopt the same policy they
economic agitators who will en¬ of the 100% reserve banking plan
be made aware of the ultimate did during the '20's' and acquire
deavor to alleviate the burden of will again recommend it with re¬
consequences. of
these schemes. large amounts of corporate bonds,
the public debt at the expense of newed vigor as a means of solv¬
The public must be educated now thus
furnishing
the
corpora¬
the banking system.
Some prob¬ ing the debt problem and alle¬ to the fact that
the
necessary Aworking
there is ho easy tions
The in¬
lems will be internal and their viating the tax burden.
solution to the debt problem that capital, or will they refrain from
of
this
plan would
solution
will
depend .upon the troduction
this can be achieved only through investing to any large extent in
ability of the banks to adjust wreck the banking system and increased work and thrift and that
corporate bonds, thus making it
their activities to the then pre¬ would lead to the ultimate estab¬
inflation
is
the most unsound necessary for corporations to have
vailing economic conditions.
If lishment of a system of Govern
Bankers Urged
To Adopt
Investment Policy: Now
('-V
'
■'
'
few
important banks to begin to
liquidate part of their longer term
Government obligations to set in
motion a wave of selling which
the less will the
and
war
inflation
of
danger
:
Thursday, September 23, 1943
THE COMMERCIAL & FINANCIAL CHRONICLE
would
be highly undesirable.
It
therefore, of the utmost im¬
portance
that banks formulate
their policies now in such a man¬
is,
that the sale of medium and
ner
long term Government securities
will not be necessary at the end
,
of the
-
-
the
banks
problems
aware
are
these
of
study them
and
care¬
fully now, they will be in a posi¬
tion
to meet and
them
overcome
ment-owned banks. It has already
been advocated that the Govern¬
ment
debt
rapidly
bound
is
institutions. Such a
would
drastically
curtail the earnings of the banks
and
would
force - many out of
existence.
Then there are those
development
mounting
public
create
serious
to
problems for the banks. Nobody,
of course, can tell what the pub¬
'
nor
what
the
debt
service
One
amount to.
the
the further revaluation
dollar, the resulting gold
or
to reduce this debt
profit to be used for the purpose
of retiring public debt.
Such a
development would lead to the
most
violent
kind of
inflation,
service, particularly if1, an undue
wipe out or materially reduce the
proportion of the total public debt
by relatively few institu¬
liquid wealth of the nation and
destroy the middle class, which
in
turn would
b'e followed by
four to six billion dollars. Efforts
will
L
be made
is held
tions. Efforts will also be made to
serious
liquidate the public debt or dras¬
tically reduce it through unortho¬
dox means.
If a large portion of
the debt is held by the banks and
a
few insurance
political
and
changes.
What
bat
these
dangers?
debt service is
In the first
The wider these are dis¬
in large.
past advocated the adoption tributed the smaller will be the
Government, those who have
the
grown
rapidly, and in many
activity
economic
of
the
private commercial banks are en¬
countering considerable competi¬
tion from them. Obviously a bank
of international trade.
evident
will
to
not
in
be
It is quite
j institutions
the same
position
trade
international
finance
they
British
that
as
during the '20's or '30's.
were
greater
applies ^ with
even
force to the banks of
operating with taxpayers' money. France, the Netherlands and other
Under the stress of war the num¬ Continental European countries.
the large banks of the
ber of these Governmental agen¬ Hence,
cies has tended further to increase United States will be called upon
and efforts will be made after the
war
to retain and convert them so
that
function in peace
So long as hostilities con¬
they
can
and
tinue
there
banks
the
to the future
effort,
can
do
Now is the
careful
make
to
economy
war
this situation.
about
time
by the
little
is
national
the
dominated
is
studies
as
relationship between
private and Government banking.
These should be undertaken joint¬
each.
of
connection
this
In
the
banks should bear in mind that if
they
fail to
meet the legitimate
needs for bank
credit
or
if their
charges are too high," the Govern¬
ment is bound to step in and re¬
Offer...
most every bank in the country.
In addition, the larger banks,
The
delineating the sphere of activity
Consolidated Debentures
problems will confront al¬
deposits
with
compete
cannot
ly by the Government and by the
banks with the view of clearly
Federal Intermediate Credit Bank
recourse
agencies
private
with
operating
.
the banks do to com¬
bank I credit?
more
These
v v'/ particularly those located in the
financial
centers, will be faced
During the decade prior to the
outbreak of the war the number with Ine task of financing a con¬
siderable portion of the volume
of Government lending agencies
time.
•
•
can
place, every effort should be made
by them to distribute Government
securities among the public at
companies and a
portion of the total
paid them by the
considerable
economic
it
to
may
prevail at that
holding such securities,
.the banks should bear in mind
that there is absolutely no risk
attached to them. The holders of,
be too late.
may
has
of
The process
nation.
it should not be delayed until
fields
money
may,
on any
of education should start now and
public
debt -be
alleviated
either through the issue of paper
the
how¬
ever, assume that the annual debt
service in the post-war
period
may reach the staggering sum of
may
posed
who advocate that the burden of
lic debt will be at the end of the
war
interest paid to
the banking
when they arise.
The
reduce the
be im¬
of taxation that cart
form
same
to
perform the functions
pre¬
viously .carried out to a large, ex*
the experience
with
not been
as
is
of American banks
business has
international
entirely satisfactory and,
known, some types of
well
transactions,
with
particularly
Germany, have, led to consider¬
,
able losses.
V
The
V
„
,
arises, therefore,
whether the large banks of the
country will make the necessary
question
During the
the due date.
on-
the
war
Treasury has refrained from of¬
the banks long term ob¬
ligations, and the longest maturity of Government bonds offered
them is ten years.
By. the end of
fering
therefore, these securities
the war,
will
,
have
a
relatively short
ma¬
There would, therefore, be
no excuse for individual banks to
sell medium term or long term
turity.
government obligations.
Should
one or the other large bank en¬
deavor
to: do
it would
so,
resentment
considerable
cause
the
on
part of the monetary authorities;
and would afford additional am¬
munition to all those who may be
devising.schemes to alleviate the
the ex¬
;
;.
The time to reduce Government
holdings
the
by
banks
demand
for commodities and the huge ac¬
security
will be when the pent-up
cumulation
■;
of purchasing
power
in the hands of the people create
high level of business, activity
when the Treasury ceases to
and
be
dependent
that
At
on
the open market.
liquidation of
by banks-
the
time
securities
preparations to meet this demand.
will be wholesome because it will
Certain
phases of international'
business are risky.
Others, par¬ reduce the volume of bank de¬
ticularly
those
which
restrict posits and thus counteract its in¬
themselves primarily to the fi- crease created through new com¬
ancing of the movement of com¬
modities from one country to an¬
The delineation of other, can be handled with a great
agricul¬ deal of safety.
Since internashort term as well as tional trade will have to be fi¬
long term, to industrial and com¬ nanced, if the banks of the coun¬
mercial credits, and ' to the fi¬ try are not ready to do it, then
nancing of foreign transactions.
it will be performed by the Gov¬
given to the future of V loans.
No unanimity of opinion exists
interestX and V principal
ceive
Government
tural credit,
Considerable thought must also
such securities are certain to re¬
a
activities should apply to
be
In
tent by those of the financial cen¬ burden of public debt at
ters
of7 Europe..'
On the whole, pense of the banks.
them.
place
irrespective of what
war,
conditions
time.
ernment, and thus another phase
of banking activity will have been
lost to the private banks.
J
One of the most important prob¬
mercial loans.
-.
.
,
'
"Closely
connected- with- this
problem is the policy that banks
should adopt toward the huge re¬
funding operations that are bound
to take place in the immediate
post war period.
At the end of
the war the floating debt of the
*
United
States,
consisting - of
Treasury bills, certificates of in¬
quidated and whether there may
be a limited need for the continu¬
ation of these loans for a period
debtedness, maturing notes and
bonds, will be large indeed.
A
considerable portion of the float¬
at the end of the war will be the ing
debt will be held by the
handling of their Government se¬ banks. It is quite certain that the
curities; 7 Let us visualize for a Treasury will endeavor to refund
moment, what the situation may its floating debt or a considerable
be at that time.
The amount of portion thereof into medium and
Government obligations held by long- term -obligations, because it
the banks will be large.
In addi¬ has long been recognized that an
tion,: as heretofore pointed out, excessive floating debt is a serious ♦.
there is bound to be a consider¬ danger to the financial stability
able criss-cross movement of de¬ of any country.
Since the banks
posits from- one section of the will* hold a considerable portion
country to another.
A number of this floating debt, they will be
of
corporations which had in¬ vitally interested in how the re-,
vested
their
surplus
funds
in funding is carried out.
Because
after the
Government
bankers as to whether V
loans should be continued in the
among
Undoubtedly a
post-war period.
need
limited
They
always have
a
ready market. When their
the
after
fifteen-day loans to member banks.
are
legal investment for trust
V
funds,
insurance
companies and savings banks in New
and other
states.
are
would tend to de¬
York
eligible to secure fiduciary,
should be
loans
The
now
They
war
the function of the banks.
Careful studies, therefore, should
be made now to determine how
stroy
by Federal Reserve Banks and are acceptable as
The debentures
Government-
guaranteed loans will exist during
the initial period of reconstruc¬
tion.
However, to perpetuate the
system of V loans on a large scale
maturity is six months or less they may be purchased
collateral for
for
ultimately li¬
war.
problems
discussed up to
will be thrust to a large ex¬
tent
the
on
banks
and
can
be
lems that will confront the banks
securities
will
li¬
quidate them in order to obtain
the necessary cash for reconstruc¬
tion and post-war expansion.. Im-
solved only
trust
and
accounts,
public funds, including war loan deposit
under authority or control of officers
7
of
dividuals who will have accumu¬
tion
lated
through concerted ac¬
the part of all. 7 There
on
however, a number of prob¬
lems which will confront each in¬
are,
dividual
bank
separately
which each will have to solve
the United States. These
9
of the twelve Federal
are
joint and several obligations
Intermediate Credit Banks
issued in maturities of three to twelve months.
First,
The question arises as to
the banks will aggres¬
sively seek this type
Information regarding the
issued
Consolidated Debentures
by these Banks, may be obtained from
CHARLES R. DUNN, Fiscal Agent
•K'
31 Nassau
Street, New York 5, N. Y.
considerable
amount
of
of loan or
the
decline
in
the
ratio
of
the part of industry and
series E bonds may also
on
to redeem
the banks will endeavor to main¬
endeavor
part of them in order
to tide themselves over the rela¬
tively short period of unemploy¬
.which will follow the con¬
clusion of hostilities, or for the
ment
of buying durable con¬
Fur¬
conditions as they prevail after sumers' goods and homes.
thermore,. at that time the Gov¬
the war. There will be a need for
loans to finance the sale of huge ernment may still \be confronted,
amounts
of durable consumers'" with a deficit and may still have
whether
CREDIT BANKS
for
there will be the
necessity of adjusting the lending
activities of the bank to economic
itself.
goods.
THE FEDERAL INTERMEDIATE
and
a
of
capital resources to deposits, be¬
cause
of the uncertainty of the
movement .of. deposits, and be¬
cause of the uncertainty as to the
future demand for bank credit
purpose
to have recourse to the open mar¬
ket for funds.
In addition,
with the
war over,
tain
a
short position in
trade,
Govern¬
ment
obligations.
They
may,
therefore, not be. willing or able
to
convert
their
short
term
se¬
curities into fong or medium term
obligations.
It is
will
be
also
i
quite evident that it
impossible
substantial
amounts
to
of
shift
any,
Govern¬
ment securities then held by the
banks to ultimate investors, for,
as
was
pointed
out
before,
cor¬
widespread feel¬ porations as well as individuals
a
large extent to non-banking ing that a material increase in may be sellers of Government se¬
agencies.
Second, there may be interest rates may take place. It curities.'f The amount of Govern¬
a considerable
demand for bank is, therefore, quite evident that ment obligations that' insurance
credit by industries for reconver¬ under such circumstances the li¬
companies' and savings banks can
sion purposes.
The demand for quidation of medium and long
this type of loan will depend to a term Government obligations by acquire is definitely limited. Un¬
large extent upon the price level the banks would cause consider¬ der these circumstances, there¬
and upon the liquidation of Gov¬ able embarrassment to the Treas¬
fore, it is clear that the banks
ernment war contracts.
Will the ury, to the reserve banks, as well
will have to take new obligations
It
banks be willing to perform this as to the banks themselves.
in exchange for maturing.. bills,
traditional function,, or will they, would be necessary only, for a
whether this business will fall to
there might be a
.
Volume
158
CHRONICLE
THE COMMERCIAL & FINANCIAL
Number 4214-;:
;
certificates and other Government
;/:■//'
obligations.
vY/•;
This problem, too, deserves the
;
of
attention
careful
'•■to plaj
banks.
the
call market has
Since the
ceased
the important role in the
'
market that it did during
money
'
20's and in view of the drastic
the
in the volume of com-
.•reduction
•;
t
r
•
mercial
and bankers' ac~
substantially larger
paper
ceptar.ces,
a
.
*
Government
amount of short term
obligations is necessary in order
to maintain the liquidity fof the
banks as well as of, the money
.
considerable
necessary;in
the post-war-': period V:The • best
solution to this problem-would .be
Hence,,
market.
a
floating debt will be
for'
Www-
Treaspr^/Tn:^
withth e banks.: after:: the' war, .to
find
for
formula
a.
>.
converting
the' short'term .into me¬
term
government/>obliga>;
graduallydium
.
>1 Through ■: such a measure
liquidity of l the /banks - could
lions.
the
be maintained and
time
yet at.the.same
floating debt
excessive
ihe
could be gradually
;-
reduced. .//v.'/
In addition to the
typically do¬
problems that will arise
out. of the war! and its aftermath,
the banks of the country will,be
mestic
assist ; in: the 'solu¬
called ' upon to
tion- o!
a
number of international
in
problems
selves "
are
Studies
which they' themdirectly/piriterest^dy
have
already been, made
concern¬
by various Governments•
ing the stabilization .of currencies.;
Although the plans so far.afe only
in
tentative
and'
character,
are
subject to further modification,
they clearly indicate what is in
the minds of the respective Gov¬
ernments
and
how
the
future
stabilization of currencies is vis¬
ualized; Tt is already certain that
international /. organization
"purpose
some
will be established for the
of
enabling
foreign
their
-.stabilize
countries' .to.
currencies.
own
"general desire to pre¬
currency wars and the de¬
There is a
vent
preciation of currencies by indi¬
vidual countries without regard
v to its effect on the national econ-; omies of .other countries.
: .V.1.
•CClosely
connected
with the
stabilization-of the currencies is
the establishment of a sound re¬
lationship
between
the
pound
sterling and the dollar. Upon this
relationship
will
depend
not
merely the value of the pound in
terms of the United States ' cur¬
but also the currencies of
'all British countries as well as
those
of several European and
Latin
American
nations.
The
rency
WQRLDlS
THE
v
ties. It
A FOURTEEN - HUNDRED - MILE - LONG
oil. previously
charging a strange kind of shell against
still remains
our
•:
It's the oil that
fighting planes,
wheels of
It is of the utmost
Britain.
im¬
.the
working of inter¬
financial
cooperation exist
close
and
United States and the
Commonwealth
of Na¬
Although the problem of
tions.
,
.
establishing a sound relationship
between the pound and the dollar
is a difficult one, it can be solved
if each country will refrain from
'
adopting a position which would
be beneficial to itself but harmful
to others.
The banks have a
•
in these
vital interest
It is their
developments.
•duty to advise and counsel the
Governmental agencies in all mat¬
ters
our
our war
power
tanks,
for our
>.
big
a
between
gap
our
war
weapon
"Big Inch" is
a
see
that
drained
of tremendous might.
Big Inch—joint achievement of the
U. S. Government and the
must
help
protect
Big Inch's
through
carelessness
can
a
guard
advantage of summer
for winter. A thorough
prepare
insulating of
your
season
you more
house during the
will prevent
heat loss, and
comfortable
on
less oil
in cold weather.
Y
You
and
hauled
capacity isn't
,.
have your
can
this life line-
oil burner
over-*
efficiency.
You
million "leaks" that
make:
can
home
your
For instance: you can correct your
petroleum
take
can
keep
Big Inch!
over
to
slack
supply.
YOU must stand
You
You
the East only 20% of the
delivered by tankers. There
our
our war¬
industry, helps keep
homes warm, too.
finance, that
between the
■British
means
our
to the future peace of
world, and particularly to the
future smooth
national trade
needs and
to
ships. It drives and lubricates the
portance
,
is
across,
vY'YY-:.'
enemies.
prices in each individual country,
but also of the changed interna¬
tional economic position of Great
.
brings
dis¬
;tube, 24 inches
problem is a difficult one and will
involve careful study not merely
of the cost of production and of
.
LARGEST GUH- andits trained on Hitler!
adjusted for maximum
plan
a rearrangement
of
permit closing off in-.
to
frequently-used
rooms to save
oil:
■
^
industry—is no business venture aimed
at
profit. Tide Water Associated
was
neighbor's mistaken idea that Big
Inch will
one
of eleven oil
companies which did
an
the
long and complex topographical
of
work, made the plans and blueprints.
Then
we
charge,
to
turned them over, without
the Government.
:
idea that
You will want to do these
surplus of gasoline—
can
lead
to
the
to
waste
benefit
do them
gasoline.
You
gets
can
/.
make
sure
to
your own car
the most out of precious gasoline
to
our
benefit yourself. You musu/0 them
make the great
deadly
thingsof course,
country's fighters. You should
cannon
steel tube of Big Inch
a
blasting the strongholds of
Hitler and his breed.
by regularly having it checked for
■
Every drop of oil that Big Inch
carry
,
create a
can
is sorely needed for bare necessi-.
efficiency,
and lubricated /for. free-
i
running operation.
TIDE
ASSOCIATED
WATER
NEW YORK
•
TULSA
OIL
COMPANY
SAN FRANCISCO
•
relating to currency stabiliza-
available
They must make
tion.
and
agencies their knowledge
experience and see to it that
ihe
plans are workable
to these
and not
visionary in character.
Above all, it is to their interest
to prevent the newly created or¬
ganizations from destroying the
international transactions of,The
merely
private banks.
work for the
rious
ing
VEEDOL MOTOR OIL
OIL IS AMMUNITION
v
CARE
USE IT WISELY
FOR YOUR
CAR
•
FOR YOUR COUNTRY
They also should
removal of the va¬
impediments imposed dur¬
the last decade on
the inter¬
of funds and
trade.
It is not sufficient for the
banks merely to criticize the va(Continued on page 1212)
SEE
YOUR
TYDOL
DEALER
REGULARLY
BACK THE ATTACK!
national movement
Buy More War Bonds!
;
/;
".if/..
•„
•
•
<
-"v.-
•
•••"■';
THE COMMERCIAL & FINANCIAL CHRONICLE
1212
A
virus.
consumer's spree is apt
in
/Thursday, September 23, 1943
of current
excess
quickly to spread over into a pro¬
ducer's spree.
Producers acquire
enlarged quantities of raw mate¬
Post-War Trust
sequently, >it
many
in
rials
creasing
orders,
distributors
and
has
savings.; Con¬
been
Government
necessary
to
secure
billions from the banks, in¬
Federal
Reserve
involving an unexampled
the
banks,
ernment
debt, and the question?
well present itself:, can -the
may
maintain
Government
if
rates
it
becomes
current
to
like
mentioned—
necessary
,
increase the debt to anything
the
figure
I
have
further increase in the volume of
$300,000,000,000?
demand
no
I think there is
the answer,
even if the possibilities of further
period of extreme inflation "and ther, and that the demand will
anticipated that' people will feel
also further increase.
This ..was for the Government to finance the expansion of credit ■ were amply-;
that if you attempt to do so the
an almost irresistible urge to sup¬
the situation as it developed gen¬ war with no increase in interest sufficient to take care of whatever *•
chances are that the outcome will
ply themselves with comforts and
rates.
This was a wise policy. amount may be required over and
;/'//" .'///■ erally following /the last war,
luxuries which they have been be loss of principal/'
There is no reason to believe that above; what may be forthcoming
The speaker outlined two fairly when inflation also spread over
fairly willing to go without dur¬
from actual savings. It may very *
distinct r types of inflation—one into real estate and in particular any significant r amount of addi*
ing the conflict itself. An infla¬
tional
saving
would have
oc¬ well prove necessary to reduce
"
'/ '
due to an intense investment de¬ into farm lands."'
tionary price movement does not
curred had the; Government of¬ reserve
quantities > of
member?
Dr.
Sprague's address follows
necessarily require as an initiat¬ mand, and the ether due to an
fered a higher rate of return on banks to what,they were in 1936
intense consumer demand, as to in full:
'
'
ing force an investment demand.
its issue. Successive higher rates and 1937. Doubtless, also; the Fed¬
which he said:
/"/
However hopeful we may be
Inflation, if it comes, will be in¬
would have affected unfavorably eral Reserve banks will hold a
"The investment; type may last about the
itiated and carried far by the depost-war world, the
all non-governmental outstanding much
greater total of; Govern¬
somewhat longer than the con¬
do
(Continued from first page)
/
the
rapidly in¬ cluding
to
response
for
the same, in the expectation
that prices wili advance still fur¬
,
deposits and currency.
By this means it has been possible
question/about
-
.
..
mand
consumers."
of
conditions which will then obtain
so
are
uncertain/' that
you
can
issues
class
bonds
of
of
the
and
better
ments at the end of the war than
now.; There is also the possibility
hardly expect me to reach defi-/
inflationary tendencies in leash,
of reinforcing the Federal Reserve
controls as the only envisage as a -possibilty follow¬ nite conclusions about investment over, if one considers the long banks with
gold certificates by
ing the return of peace. Infla¬ policies in the handling of trust future, it may/well be that the
practical means.- "Obviously," he
low rate of interest safeguards the making use of the so-called two
tion
may
then effect, *we can funds. I shall do no more than
said, "price controls will be even
Let us billions of gold profit derived
imagine, an increase of say, 100% examine certain factors, of which principal/of the bonds.
more difficult than now during a
the
;
type of inflation and it is
sumer
."Reviewing methods of holding
consumer
type that we have, to
preferred stocks. / More¬
-
he, finds price
,
period of slowly expanding pro-,
duction for civilian use. Who, for
in
example, are to be the fortunate
movement
purchasers of say, the first two
million new passenger cars at the
time when there may well be a
demand for eight million units?
Whether
the
public itself will
many
controls
definite
/
uncertainties
is
It
are
"If I
at all concerned over
return
istrators
tain
very
■
the
position of particular investment
presumed that the
securities with a good
•///
issues.
When
including utilities, would
be reduced. During that period
not
be
velopments that may change
coverage,
you
'
//•/'
return home I sup¬
all of you will be actively
engaged in the current war bond
pose
recipient of income from trust
^campaign and I presume that you
would doubtless suffer as
will invest some part of all avail¬
would
many
classes of wage- able cash funds belonging to your
earners.
/://
various accounts, in government
"One of the uncertainties aris¬
securities. No doubt you did this
ing out of inflation is due to the
during previous bond sales and
impossibility of knowing what will continue to do so in future
particular companies will do when bond
campaigns to the end of
subjected
to
the
inflationary the war. Certainly, the same con¬
the
governmental control, and cer¬
tainly no group should be more
definitely in favor of such con¬
trols than you who are charged
with the administration of trust
funds." So far as trust accounts
are concerned he warned admin¬
income
on
to
:
venture
then it may be
uation,
he
told
the
bankers,
"strongly favor the continuance of
venturing
finally> if time serves, I may
to call attention to cer¬
social and technological de¬
And
am
,
who
the sit¬
presumably be taken
positive about their practical ap¬
plication. The three factors which
I propose to examine are govern¬
ment bond investment, the cours3
of interest
rates, and inflation.
right in my assump¬
tion that the inflationary splurge
would not be of long duration,
those
all
that
clear
persist for
not
years,
movement. started,-.
one
/////.// ///v.:./
ture." /;/■•'■///'
without
level that obtained when the
the
of the
of the fu-
obviously
would
account must
inflationary
the
that
also
perhaps two, or at
the most, three years. Then would
come the collapse with a precipi¬
tate decline in prices, perhaps to
price
of
continuance
a
is
I think we may
certain
feel
,
support
prices.
funds
that they cannot hedge
successfully,
against
a
that
suppose
the
war
dollar in
something
like the present scale of interest
end of the
the
by
depreciating' the
from;
debt
1933;
Government
total
reaches
Maintenance
of
$300,000,000,000.
At an
to the Government rates, then, until- the end of the
of 2%, servicing the debt with war, seems to me one of thd most
definite certainties in the present
moderate repayments would ab¬
sorb a revenue of between $6,000,- situation;
and
$7,000,000,000
an¬
000,000
In spite* of the unprecedented
nually. Revenue required to meet increase that has taken place in
this charge together with neces¬ the volume of demand
deposits
sary Government expenditures for and the
currency in circulation,
other purposes can, I think, be and the further increase in
pros¬
readily forthcoming without in¬ pect I do not anticipate an infla¬
cost
average
strain
tolerable
Suppose
4%
the
and
upon
taxpayers.
that the rate were
debt charge
now
annual
It
requires
no
imagination to en¬
$12,000,000,000.
stretch of the
visage political action of one sort
toward
directed
another
mid
re¬
ducing the burden arising out of
financing the war.
;
notice in what I have
tionary movement of prices dur¬
ing the continuance of the war.
The body economic will continue V
to enjoy irnmunitv in spite of the
further rapid multiplication of in*
flationary / germs.
Patriotic re¬
straints, rationing, price ceilings,
and
other Government
policies«
to
seem
me
altogether
likely
to
maintain
fur¬
prices and costs in the
neighborhood of : present levels
ther massive increase in the Gov¬
during the remainder of the con-
You will
that I anticipate a
lust said
siderations that have led you per¬
sonally to subscribe to war loans
apply to the trust accounts
which
administer now.
There is
(Continued from page 1211)
surely no class or group in the ;;/?//;:///./;-; /
community that even in its own rious reports and plans.
What is scribed as decadent and moribund
purely selfish interest would be more important is to point out by so many during the period of
well advised to hold aloof. At the specifically wherein the Individ^ the
depression. / American
in¬
end of the war, then, we may
ual currency stabilization plans genuity, management and labor
are weak
and are bound-to fail, have forged, and are continuing
presume that some portion of all
trust accounts will have been in¬
and to make constructive suggest to forge, the weapons which will
vested in government bonds, and tions 10 improve them and to co¬ destroy the enemies of humanity
I think we may also assume that ordinate them at the same time —the
so-called
master
Taces,
this condition will also continue with the facilities of the private white
and
yellow—which have
for an indefinite period thereafter. institutions which have been en¬ drencned the earth in blood.
In one interesting respect this will gaged in
international financial
The banks of the country have
create a favorable situation for transactions for decades.
played an important and honor¬
the beneficiaries of trust funds.
It is also the duty of the banks
able role in this titanic struggle;
In the past necessity of full in¬
to give
considerable thought to They have stood
ready at * all
vestment, advantage could seldom the question of restoring sound
times, to
meet
the
tremendous
be taken of bargain situations in
currency conditions at home. This
heeds of the Treasury. They have
the security market. A fund with
implies such questions as the use
played an important role in pro¬
a
fair
amount of Governments of
gold as a monetary metal and
viding financial resources for in¬
can benefit in such situations for
the removal of legislation passed
dustry and in the distribution of
I assume the market for govern¬
during the depression of the '30's
Government securities among the
ment
securities
will, be main¬
affecting the monetary - system.
people of the country.
tained in all circumstances—some¬
All these questions are bound to
The time is not far distant when
thing that could hardly be said of have a direct effect on the opera¬
other bonds, even those of the
swords
will
be
converted
into
tions of the banks and should be
you
.
INSURANCE
FEDERAL
MEMBER
CORPORATION
STATEMENT OF CONDITION
JUNE
'V'•///■■
Cash
U.
Deposit in Federal Re¬
Other Bank$_;
—
$40,993,459.97
on
and
Bank
in
Direct
Obligations,
Government
S.
//////■.'
or
Guaranteed
Fully
Federal
;
RESOURCES
'
Vault,
in
serve
30, 1943 /
70,859,103.65
•
era! Trust Debentures. Federal - National
Mortgage Association Notes and Federal
Bank
Land
State
Accrued
and
Interest
Notes
//
792,090.04
_
,
320,128.74
Bonds—
on
; ■'
,./
1,841,204.75
Bonds
Bonds
Municipal
of
State
and
Carolina
Carolina
/'/■//:
:
1,122,548.90
!
Bonds
North.
of
South
//?:/'/';
Collat-
Bank
Credit
Intermediate
:C
115,928,539.05
19,790,069.65
Cash
the
Surrender
Officers
Value
Insurance Policies
Life
Carried
on
113,554.10
.of the.
236,003.00
Stock Federal Reserve Bank and Other Stocks and BondsIncome
Earned
Not Collected
But
./
—
Customers'
Banking
Liability
House,
45,206.65
37,639.13
Prepaid Expenses
and
Furniture
Fixtures
and
\
of in¬
importance, not
merely to holders of Government
securities, but to holders of all
other securities yielding a fixed
I
544,061.80
v
$137,636,104.90
LIABILITIES
$1,200,000.00
Capital Stock
Surplus
.
829,371.25
3,829,371.26
Reserve
Interest
for
1,000,000.00
Contingencies
Collected But Not
Earned
Reserve for Taxes and Accrued
130,818.89
of
Credit
and
Acceptances
Less—Reciprocal
941,031.52
Outstanding.—,—.—
DEPOSITS—Gross
137,434,730.41
Deposits
6,958,006.20
130,476,724.21
$137,636,104.90
Assets and Liabilities
Not
of Insurance and Trust
Included
in
Above
return.
to the rate
Departments
Statement.
During the years imme-
mally low level. In part this was
to the easy
money
policy
due
one
183,977.91
Letters
come
diately preceding the war, inter¬
est rates declined to an abnor¬
adopted
58,159.02
Expense—,
t
;
$3,000,000.00
_
Undivided Profits
now
terest, a matter of
real
other
highest rating.
very
941,031.52
Letters of Credit and Acceptances
on
by
the
Government as
of the means of
dealing with
depression. There was a large
increase of the volume of credit,
both in the form of demand de¬
the
posits and currency, but there was
no respbnse of prices.
The mere
increase in deposits and currency
did not serve to bring about in¬
flation.
The explanation in the
main
seems
to
be that there was
carefully studied by the banks as
a
whole with a view to making
recommendations
sound
the
to
monetary authorities.
/
/
The war started by the Germans
in
be
the
expectation that it would
in
over
enemies,
few months has en¬
a
fifth
its
tered
are
While
year.
our
still strong and will
put up stiff resistance before they
are forced to surrender,- they are
w
T INSURANCE
Member
CORPORATION
Federal Reserve System
Charlotte, North Carolina
LARGEST
BANK
ALL
IN
UNDER
THE
ONE
CAROLINAS
ROOF
tXSlIXlIXXIIIXXXXXXXXXXXXItXllllliixiifTYTfiYTYYgl
A nation that could be¬
within
come
time
the
and
convert
short-
relatively
a
arsenal
of
democracy
millions
of
peace-
loving farmers, laborers and white
collar
people /, into
fighting
men
In
this
formidable
should
difficult to
peaceful pursuits.
very
process
not
find
return
;
to
;.//•/.,/
•■/
it
its
//',
of reconversion
retreating on all fronts and their
armor is beginning to crack.
Vic¬
the
Their ability to perform them will
tory
will
fighting
be
men
ours
because
of the United Na¬
fighting
tions know what they are
for-—not for world conquest or
for
glory—but
and their children may
peaceful ways and enjoy
Lebensraum,
not
for
that they
iollow
the fruits
of their labor.
In this
important
functions
to
perform.
depend to
a large extent upon the
they take now.
Above
all, the banks should not forget
that upon the solution of some of
measures
the problems which will confront
them
not
after the
war
merely their
will
depend
future but
that of the economic and political
system of our country.
Hence,
own
investment demand fight they ; are backed by the
mainly with might of American industry.
Many miracles have happened while our energies are devoted to
investors that the increased vol¬
crushing the enemy, let us at the
ume
of funds
found lodgment. during the long struggle, but per¬
same time not forget the future.
The germs of the inflationary dis¬ haps the greatest of all, at which
The problems that will confront
people will continue to marvel in
ease were abundantly present, but
the future, is the rapid and ef¬ us will be great indeed but they
the body economic seems to have
ficient- conversion of American can be solved if all of us approach
been immunized by the general
them in a spirit of good-will and
absence
of
business
confidence industry into the arsenal of dem¬
during those years.
I ocracy. This feat has clearly dem¬ understanding and work on the
principle that what is best for the
During the war there has been, onstrated the vitality and inher¬
ent
strength of the system of countiy as a whole is best for the
an immense demand for funds on
individual.
the part of the Government, far' private enterprise which was de¬
no
FEDERAL'
mobiles. '
the banks of the country will have
adequate
for funds and it was
MEMBER
plowshares and tanks into auto¬
^
ftlaM*9lwWMtaMrc *
„,
4fflHWiWAki vw|f*w^
HW«?srt*^<m>-1AWirttfftwi*}!
Volume 158
THE COMMERCIAL & FINANCIAL CHRONICLE
Number 4214
flict. ;, That." has ;been; the expe¬
of countries that were, in
the
rience
come
when the
the
tate
of
two years before we
war
came
!
'.engaged,' and
to believe that
son
will
change
pattern.
experience
existing
the
from
o.vvV■>,-
;
After
be¬
see no rea¬
our
this
series of pre¬
liminary observations, I finally
come
to my subject proper, the
post-war period.
Can and will
interest rates continue to be stable
long
most, three years. Then would
the collapse with a precipi¬
decline of prices,
perhaps
even
when
to
the
level
that
obtained
the movement started.
If I
likely
you
Prudent
folios
be " seriously damaged
collapse comes. For those
who operate under the
to
Investment
will
doubtless
Rule,
port¬
include
va¬
1213
that a portfolio containing a fair
amount of government bonds will
be in a good position to take ad¬
bargain
situations
collapse from inflation
since at that time we may
right in my assumption that the
inflationary splurge would be of
rious issues which appreciate un¬
der the impact of inflation. Prof¬
feel confident the market for Gov¬
short duration then it may be pre¬
sumed that the return on securi¬
its
ernments will hold up
ties with a good coverage
includ¬
ing utilities would not be reduced.
During that period the recipient
on
such issues should be taken
if inflation comes, more generally
than I think has been the prac¬
tice in the past.
occurs,
the
have
we
as
demand
This
will
was
the
it developed
lands.'
In
better than
T":"v,v
country with
a
a
small
num¬
ber of banks it is
other class of securities.
One of the uncertainties, aris¬
any
pose
To quote obser¬
possible to im¬
check on a spree of
some
producers
vation often heard in the London
tion.
In
rely
through
upon
concerted
ac¬
this
country we cannot
effective restrain being
exercised
by
the
commercial
banks.
Owing to the multiplicity
of banks, something like 15,000
in number, it may almost be said
that
borrowers
have
the
whip
hand, each bank fearing to lose
•
Here
the
generally
following the last war, when in¬
flation also spread over into real
estate and in particular into farm
the
am
that
and
situation
of
vantage
when
ther,
also further increase.
ing out of inflation is due to the
impossibility of knowing what
at the present low level, and will of income from trust funds would
market, "Let the other fellow particular companies will do when
inflation be escaped?
to
the
inflationary
Here we doubtless suffer as would many have the last crown—he'll earn subjected
of
virus. A consumer's spree is apt
enter a field crowded with uncer¬ classes
wage-earners.
That it if he gets it."
It would probably be somewhat to spread quickly over into a pro¬
tainties. Unlike the pre-war pe¬ seems to be one of the inevitable
riod, ownership in the expended consequences of inflation. If you helpful in the management of ducer's spree. Producers acquire
seek to enlarge income step by trust accounts if some part of the enlarged quantities of raw ma¬
currency and demand deposits is
widespread throughout the com¬ step with the upward movement profit from security sales, espe¬ terials in response to rapidly in¬
in
periods
of
inflation, creasing orders, and distributors
munity and a large fraction of the of prices you will be investing cially
Government securities issued dur¬ in companies that are with large, could be allocated to the income do the same, in the expectation
profits but in companies that are beneficiary.
In any event, I feel that prices will advance still fur¬
ing the war contain security for
their redemption at par on de¬
mand.
WW{,♦> fWr i,kMf '
m*M(
In the
desirable accounts.
the
lands
farm
case
of
it may
be hoped
(Continued on page 1217)
pur¬
chasing power for an intense de¬
mand for a far greater quantity
of civilian
%oods and services than
will be available for many
after
the
triotic
than
of
return
will
restraints
and
now
it
months
Pa¬
peace.
weaker
be
be antici¬
may
pated that people will feel an al¬
most irresistible urge to supply
themselves
with
comforts
and
luxuries which they have been
fairly willing to go without during
An inflationary
the conflict itself.
not neces¬
price movement does
sarily
require
force
initiating
ah
as
investment demand.
an
flation,
if it comes, will
itiated
and
demand of
this
of
by monetary
Credit con¬
means.
would
not
"There likewise 1 beheld Excalibur
Before him at his
restrained
be
cannot
in¬
the
by
A demand
consumers.
sort
traction
far
carried
In¬
be
More¬
serve.
That
«*
rose
crowning
"
"
IDYLLS
.
well be confident
means
of control will
we
over,
not
be tried, since it would
calamitous shrinkage in
even
involve
a
all bond
values, including Govern¬
ment.
Without doubt the Govern¬
ment
will
active
bonds
seek
maintain
to
for f'
market
Government
reasonably stable prices.
on
only practicable means of
holding inflationary tendencies in
leash 'is a continuance of price
controls.
j price: - con¬
Obviously,
trols will be
even
"during,;: a
now
to be the fortunate purchasers
ol say, the first two
passenger
there
million
new
well be a demand for
eight million units? Whether the
public itself will support a con¬
tinuance of price controls is obvi¬
ously one of; the definite uncer¬
tainties of the future. On the other
who
it
at
all those
that
clear
is
are
concerned
all
about
satisfactory functioning economi¬
cally in the future strongly favor
the continuance of, governmental
certainly
and
control,
group
no
should be more definitely in favor
who
of such controls than you
the
charged with
are
administration
of trust funds.
KING—Ttnnjion
THE
was
by Magic that King Arthur received Excalibur, the
gleaming sword that symbolized victory
his enemies.
over
By
processes as
the
mysterious to the layman as Merlin's Magic,
Rustless Iron and Steel Corporation is
another
shining
for
weapon
helping
That
America.*
to
forge
weapon
is
Stainless Steel.
Because of its
exceptional properties of high tensile strength
and resistance
to
Steel has
essential
seem
corrosion
by heat, acid, and
rust,
Stainless
long since become a'; "must" in the production of
war
synthetic
such
equipment,
rubber,
aircraft,
chemicals,
as
warships
•
and
explosives,
motorized
units.
Serving and Conserving
RUSTLESS, devoted entirely
Stainless Steel,
is
doing
two
to
manufacturing high quality
important
war
First, Serving the Nation by producing
than
any
employees
other plant- in the
are
jobs:
Stainless Steel
more
Day and night its
country.
making certain that Uncle Sam
Stainless Steel he needs.
all the
gets
'•*
There are few in¬
dividuals
who
able
to
fish
invest¬
ment waters, and certainly you
cannot expect to do so in the
successfully
troubled
in
administration of trust funds.
I
to the
come
now
>*
question of
do-about it in the event
what to
that the country should be so un¬
fortunate
to
as
pass
through
accounts
say
that
concerned
are
you
I
Second, Conserving Strategic Materials
RUSTLESS Processes
great
would
cannot hedge income
successfully,; against a period of
inflation, and that if you
attempt to do so the chances are
quantities of
in
two
trolytic Nickel—which
the
,.
.
ments.
to
i
The unique
.
manufacture of Stainless
save
critical metals—Chromium and Elec¬
are
not
only essential for the
facture of Stainless Steel, but also for many
a
period of inflation. So far as trust
.
It
at the time when
cars
may
hand,
OF
difficult
more
period of
slowly expanding production for
civilian use.-Who, for example,
are
<-
an
The
than
'
*
may
this
that
borne, the sword
from out the bosom of the lake"—
other
war
manu¬
require¬
By certain discoveries, RUSTLESS has found
achieve equal results
through the
into the furnace and
by the
supplies of which
use
of
ores
ways
charged direct
plentiful.
are
recovery
of Stainless Steel
scrap,
extreme
the outcome will
that
principal.
there are
be loss of
I see the matter,
two fairly distinct types
As
of inflation.
One is due to
tense investment
other due to
an
Therefore,
tp
this twofold duty—Serving and Conserving—
RUSTLESS has dedicated its highly specialized organization
for both the winning
of the
war
and the
peace to
follow.
in¬
demand, and the
intense consumer
an
demand. The investment type may
last
-
somewhat
.
longer
than
the
type of inflation and it
is the consumer type that we have
consumer
envisage as a possibility follow¬
ing the return o.f peace.
Infla¬
tion
may
then effect, we can
USTL
to
imagine, an increase of say, 100%
in prices.
I think we may also
feel certain that the inflationary
movement
rpany
would
years,
not
IRON
AND
STEEL
BALTIMORE,
CORPORATION
MARYLAND
'PwCudKCf STAINLESS STEEL ^xclyAcvcltf
persist for
perhaps two,
or
at
BUY
MORE
WAR
BONDS
THE COMMERCIAL & FINANCIAL CHRONICLE
WML
Thursday, September 23, 1943
sentence until after the
Invesfois Meed A War-Time
Stay In
Execution Of The "Death Sentence"
again should
be in the mind of
Congress when a particular sec¬
tion of the Act operates in a way
which
probably was not contem¬
plated fty many of " its supporters,
and
certainly
stances
of
circum¬
under
beyond imagining by any
in the peaceful days of
them
Execution
1935.
sentence"
on
of
"death-
the
the terms
now
pre¬
scribed
j by the Securities and
Exchange Commission, and in the
utterly, abnormal
war
period,
would result
in
losses
ors That would be
arable.
-;-
What
"death sentence"?
the
is
The wPublic
Utility
consists; of two parts.
to dp
is
and
the,, .Securities
Commission.
administered
Power
:
'
Act of 1935
Title I has
with holding company sys¬
tems^
an
invest¬
to
literally irrep¬
administered
by
Exchange
Title II, which is
by
the
Federal
and
Commission,
amendment
Water
Power
to
constitutes
the
Act
Federal
originally
adopted in 1920, and has to do
operating companies; with
"^licensed
hydro-electric
projects
on
navigable streams, interstate
transmission of energy, accounting
matters, etc. This is an interest¬
ing story, in itself, but its telling
has no place here.
Title I is generally known as
the Holding Company Act
It
consists of 33 sections, some of
more and some of less importance,
with
and i I
might be added that some
are
mlore
enthusiastically
en¬
forced by the SEC than others.
By fart the most important and
controversial
is
Section
11, in
which the "death sentence" is ex¬
pressed chiefly in two major sub¬
sections, Section 11 (b) and (1) is
.already famous as the territorial
specification. Its object is to re¬
cast each holding company into a
single integrated unit, with cer¬
tain
permissible adjuncts. The
equally famous Section 11 (b) (2)
relates to corporate structures. It
sets forth the "grandfather" speci¬
fication that no holding company
system shall include more than
three tiers of companies; for ex¬
ample,
an
operating
company
topped by one intermediate hold¬
ing-company 'parentj topped in
turn by the final holding-com¬
pany grandparent.
A quick men¬
tal attempt to fit into this pattern
any of the larger holding-com¬
pany systems as they exist today
will make clear why Section 11
came
to be known
sentence."
Now to go
was
the "death
as
;
'
Mention
made above of the trinity of
back
named
interests
interest of the
a
in
bit.
Act—the
the
public, and of in¬
This
vestors, and of consumers.
*
reference
times
occurs
seldom
less
than
Accord¬
exam-
sen¬
present
emergency
lies with the investor
in holding
His
The
ihe public, the Commission spe¬ typical holding company has out¬
debentures
and
pre¬
cifically required the utility to do standing
Power Company common stock to
company
need
ferred
stocks.
stay is urgent.
common
lor
a
stock
well
as
common
as
the same thing. Yet these service
companies, under Commission or¬ stock, and these debentures and
preferred shares must be retired
ders, operate on a non-profit
as
the first step in dissolution.
war.
To disturb those already basis,
so
that any contribution
How can they be paid off?
Gen¬
doing a war job would be to risk they make to operating clients is
erally, not in kind; not by the
a clear gain.
a let-down in the war effort. The
Nevertheless, these
distribution
of
subsidiary com¬
utility industry, as it stands now, two utilities, among others, were
mon
stocks, if reason and ex¬
is making
an
outstanding con¬ forced by the SEC to sever estab¬
tribution to the war effort. Since lished relationships in the present perience are any guide.
Take
the
case
of
National
execution of the death sentence war emergency, and to face the
now
would radically change es-, many technical problems which Power & Light Company.
After
its
debentures
out
of
tablished relationships within a The war will continue to force fetiring
cash on hand, it offered Houston
large segment of the industry, it upon them without the expert
would
jeopardize an important advice and judgment to which Lighting & Power Company com¬
cog in the war machine.
It must, they owe, in considerable part, mon stock in exchange for its
own preferred shares.
Although
then, be against the public in¬ their past success. It is difficult
to see how this sort of thing con¬ the exchange offer was held open
terest.
1
Consumers are concerned with tributes to the interest of con¬ for a iong period of time, and the
paid
the best possible service at the sumers.
y::.
help
of security
dealers
lowest possible rates.
Execution
Investors,
obviously, are af¬ finally was enlisted, only about
of
the
death
sentence means, in
distribution of oper¬
ating company common stocks to
the investing public at large.
No
new investor is likely to hold as
much as 10% of any one issue
after
distribution,
because
he
would then be a holding com¬
pany.
And with utility common
stocks spread so thin, no one will
most
cases,
have
a
sufficient
investment
in
the typical operating company to
justify the expense of close super¬
fected by both the public interest
half the holders of National Pre¬
and
ferred.
death
in
interest
consumer
sentence.
They
are
the
not. a
separate group, but rather part of
the
general public and the users
of utility services.
But they do
have
additional
quiring
war-time
a
of
execution
the
for
reasons
stay
death
re¬
in
the
sentence.
It will be remembered that the
Holding Company Act was de¬
signed in the "interest of invest¬
in
the
of
securities
holding
vision of its affairs. Because util¬ companies
and their subsidiary
ities do not compete with each companies and affiliates," among
other directly, and because each others.
It is simpler first to con¬
is influenced by many factors pe¬ sider
the holders of subsidiary
culiar to itself, there are no ready or operating company securities.
means of comparing results.
These, of dburse, are principally
On the contrary, a critical sur¬ senior securities, bonds and pre¬
ferred stocks, since their common
vey
of utility operations is a
stocks are very largely owned by
highly specialized and technical
holding units.
But while
matter.
And in the absence of the
close and continuing supervision operating company senior secur¬
there would almost certainly be ities have undoubtedly been ben¬
ors
in many phases of
companies' performance. The
industry is dynamic to the point
where this deterioration would be
tion of the
the basis of shares
on
held,
accepted the offer, and only about
half
the
Houston
serious in
a
very
would
few
years.
The
they would be injured by
common
distributed.:
was
distribution
the
effect
to
on
stock holders
it
received
the Houston
the
public.
National's
per
Certainly this problem
is serious enough to warrant calm
study, which obviously is impos¬
operation.
under
tions of
the
turbulent
condi¬
war.
To carry
the point further, two
On April
29, li>43, the SEC approved the
sale of Houston Lighting & Power
Company common stock at com¬
instances may be cited.
petitive bidding
dissolution
of
as a
step toward
National
Power
&
Light Company, but on the con¬
dition
that the Houston company
cancelled
its
for
tive bidding, that stock now is
selling at 61. By being forced to
dispose of Houston common when
it did, National Power &
Light
and its
lost
common
about
months,
stockholders have
$2,500,000
and
in
four
the
entire
when
transaction is considered that loss
runs
10
over
United
pany
is
$5,000,000 today.
Gas Improvement Com¬
another
example.
Last
it
liquidation
.;
proposed
a plan of
SEC
insistence,
which Was approved by the Com¬
mission and is now well along
toward consummation.
The plan;
was extremely ingenious.
United ■
Gas
Improvement had no out-:
standing debt, but it did have
$76,500,000 of $5 preferred stock
at its liquidating value of $100 a>
at
share, which was redeemable at"
$110. This stock obviously had to he
satisfiedf before
liquidation;
could
progress
to the point of
distribution of assets to the com-1
Under
stock.
rhon
the
doctrine
upheld by the United States Su¬
preme Court a few months later'
in the United
Light & Power de¬
I, /probably:
could
its preferred'
stock at $100 a share.
But the
company did not have $76,500,000
in cash, so an alternative had to
benture
case, U. G«
have paid off
be found.
An
extremely
ingenious
ex¬
change offer was evolved, which,
gave U. G. I. preferred stockhold¬
ers part cash and the balance in.
new $1-dividend preference common
stock of Philadelphia Elec¬
tric Company.
The new stock
,
was
convertible
made
into
the
company's regular common
on
a
sliding scale, starting at
share
for
share.
Taking
the.
stated value of the new prefer¬
ence common as the base, the in¬
itial conversion was at $20 per
share for
Philadelphia Electric
same
These conversion prices,
however, could not have been,
picked out of thin air.
To be,
common.
worth
anything they had to be
market price
of Philadelphia Electric's regular
common.
The initial price cer¬
tainly had to be close enough to
promise action within a reason¬
related to the then
able
period
clusion
of
cannot
time.
be
The
con¬
escaped, then.
MMyMiank
execu¬
of Miami
EDWARD
securities are at
C.
ROMFH, President
no
suffer, in peace time as well as
war
time, from inferior utility
sible
share
at competi¬
common
longer get the
peak
of
their
investment
the best possible service at the standing right now, and are the
lowest
possible rates, and the most highly regarded investment
public interest is involved be¬ medium of any large industry.
cause the national economy would
The principal investors in oper¬
consumer
And
common
adverse. Where
was
$51.85
death sentence today.
Utility senior
-stock
The other half
had to be sold to underwriters for
efitted in the past by the opera¬
tion of certain sections of the Act,
deterioration
the
any
two.
before
the
in
concerned, there is only one stan¬
dard for measurement today—the
Fre¬
mentioned,
ingly, it seems well to take a
quick look at /the effect of the
the other two
on
ing the interests of investors.
So far as the public interest is
and
throughout the Act.
sentence
classes of interests
many-
many,
quently all three are
death
inter¬
est in execution of the death
tence
(Continued from first page)
December
war.
;But the most immediate
existing
did not thereafter
contract,
enter into
contract, with the
service company then assisting it
in a managerial and supervisory
capacity. Again, on Sept. 1, 1943,
in approving the sale of Idaho
future
ating utility bonds
are
Greater Miami's Oldest
South Florida's
Under Same
and
aside
from
Management Since Organization in 1!>02
Member
country.
Insurance
company
holdings of these bonds are so
huge that they would be difficult
to market
over
any
reasonable
period of time at any reasonable
prices. Accordingly, the insurance
companies, by virtue of this con¬
alone
Institution
insurance
companies, which means'
indi¬
rectly, most individuals in the
dition
Largest
Financial
;
,
Federal
and Federal Deposit
Reserve
Insurance
System
Corporation
any
internal
policies, are likely to re¬
main
large
holders
of utility
bonds for many years.
As such,
they and their policyholders must
be concerned about anything that
tends toward deterioration of the
utility industry.
effect
this
of
the
direction
With the adverse
death
sentence
already
in
discussed,
it becomes apparent
that investors
utility senior se¬
curities need a stay on the death
in
operating
STRENGTH
SECURITY
SERVICE
•
-
1858 :
•
1943
KIDDER, PKABODY & CO.
FOUNDED
MEMBERS
NEW
YORK
AMERICAN
BOSTON
1865
BANKERS
ASSOCIATION
PHILADELPHIA
;
'
Corn Exchange
CHICAGO
National
and
Trust
Bank
Company
PIII LADE LP III A
ALBANY
.
SPRINGFIELD
PROVIDENCE
.
HARTFORD
NEWPORT
LOWELL
NEW BEDFORD
Established 1858
BALTIMORE
Member Federal
Deposit Insurance Corporation
Volume
158
that
offer
THE COMMERCIAL & FINANCIAL CHRONICLE
Number 4214
pre¬
On
ferred holders of payment in cash
there
the
kind
and
sale pi
was
U.
to
G.
I.
equivalent to the
a price related
in
as
record
nents in the national economy.
Utility pre¬
1942.
the
unjustly penalize the hold¬
both positively in the dollars
wotild receive and relatively
compared with other compo¬
er,
he
imagine oneself back
December,
of
doubt that forced
no
would
to the market price of that asset.
To see the whole picture it is
necessary to
basis
be
sale qt utility stocks at this time
asset at
an
the
can
1215
it
Why have utility stocks fared
badly? Is there reason to think
they can do better in the future?
If the answer is in the negative,
sale at this time is as good as
any.
But if it is in the affirma¬
neither
tive, holding company stockhold¬
ferred
and
moved up
common
had
stocks
so
somewhat in price dur¬
ing the preceding few months, but
prospects were far from
their
To show investor sentiment
clear.
might be pointed out that
Moody's nor .Standard &
Poor's, the two largest and best
known
statistical
and
advisory
ers
at least
ficult
to
so rare
as
ed
was
to be dif¬
was
of
$15
in
all, it looked at that time
the
U.
G.
and
I.
might
be
share.
securities
As
$105
to
the
regarded
was
G.
fered
I.
a
if
offered
$110
a
itself, it
favorable
to
because it of¬
better work-out than pre-
viously had seemed possible, and
as holding out enough prospects
to preferred holders to forestall
violent objection.
What
is
the
situation
now?
at
$20, thus making the over¬
to
U. G.
I. preferred
holders worth $115 per share to¬
day. Assuming the old preferred
could have been retired at $110 a
on
But if the
is
$3,750,000. And if retire-
difficulty is not fun¬
damental, what is it?
cash, the excess price
the basis of current mar¬
kets
in
vestors.
in
paid
improved
Rates are declin¬
ing steadily. Management is bet¬
ter, by force of circumstances if
nothing else. And utility bonds
command the highest
prices of
any large industry and are most
sought after by experienced in¬
offer
share
and
certain respects.
around
all
new, the
concepts had to be ex¬
perimental to a large extent. Leg¬
islation in which they were em¬
bodied
had
to
be
written
as
framework only, the substance to
be
filled
in
by administrative
bodies.
At best, legislation of this
will create uncertain¬
character
ties
in
The
the
minds
records
of
of
investors.
administrative
bodies,
moreover,
have not al¬
ways been of the best. For in¬
stance, the Securities and Ex¬
change Commission, a five-man
body, has had 15 different mem¬
bers in its eight years of exist¬
ence, and it has had six different
chairmen.
Numerous changes in
Commission policy and interpre¬
tation of the Holding Company
Act have been the logical result.
With reference to the death sen¬
tence
upon
standardized
Philadelphia Electric preference
common is selling at about, $25 a
share and the regular common
New
1935",' ad¬
specifically, the Commis¬
sion's early ideas, when the'Act
has been
was fresh out of Congress, ran to
and un¬
the belief that swaps of operating
his letter
Director properties between holding 'com¬
would result" in
of the
Office of War Utilities,, pany > systems
of systems
said of the electric utility indus¬ practical integration
without inconvenience or loss to
try, "the installed generating ca¬
investors.
But the Commission's
pacity, together with the capacity
present ideas are much more ex¬
now under construction, is ample
treme. A very narrow interpreta¬
to
meet all foreseeable electric
tion is put on the death sentencdf
demands." By retirement of senior
liquidation
the- only
securities, capital structures are making
course possible in the great ma¬
markedly better than they were.
Accounting methods have been jority of cases. Thus, the uncer¬
plan
as
common,
than
crumbled.
stocks
constantly being devel¬
Act of
Utility
ministered ; by
the SEC as to
Title I and by the Federal Powerx
Commission as to Title II','was by
far the
most important.
Being
them never
questioned by informed
prejudiced observers. In
of July 24, J. A. Krug,
All
as
are
made
preferred stockholders
worth an aggregate
nearly
more
U.
share in the market.
a
cash
consti¬
oped for the services they render.
Their ability to meet the demands
worth about $14
or
is need¬
utilities
that
basically sound and grow¬
their
uses
be
to
a
re¬
,
And, finally,
Philadelphia Electric regular
common,
into
which
the new
common
chance to
ing industry. Their market ex¬
panded almost without interrup¬
tion
all
during the depression
period and after, when the prices
appraise.
preference
a
that improvement.
show
to
tute
the
convertible,
entitled to
on
No extended argument
services, had yet made any gen¬
eral purchase recommendations as
to public utility stocks.
"Prefer¬
ence
common" stocks, moreover,
were a classification which, while
perhaps not entirely unknown,
were
are
alize
Public
new
In the 1930s
concepts of regulation were
introduced in the utility field. The
UNITED
GUATEMALA'
★
EL SALVADOR
PANAMA
★
★
COLOMBIA
FRUIT
HONDURAS
*
CUBA
COMPANY
★
NICARAGUA
★
*
JAMAICA, B.W.I.
Back the Attack with War Bonds!
COSTA RICA
tainties in the monds of investors
into actual fears. And the
greatest fear soon came to be that
of future
developments - in en¬
grew
forcement
which, on the record,
could only be worse than .those of
the
past. Is it any wonder that
utility stocks were offered for
sale in large volume in a market
_
containing few buyers* and there¬
fore declined in
That alone
was
(Continued
price?
not bad. enough.
on page
1216)
THE COMMERCIAL & FINANCIAL CHRONICLE
1216
\ ;
1
1
-I
•.UNDERWRITERS ^*1
DEALERS
DIVIDEND NOTICES
The Securities Salesman^ Corner
su:-
.
Thursday, September 23, 1943
•(
•>
'•
■ ¥
.
1.
•
'
•
•■■■■?
i.Z
;
-•.
i
/
,
!;
•
Uncovering New Accounts Through
Advertising Campaign
7
'
.
a
y,7
i
»
Newspaper
!,
'
7
,T
Before you can get new accounts the first job is to locate them.
week we'd like to pass on some ideas that have proved suc¬
cessful for a progressive dealer in a medium-sized Southern com¬
L ■ >,
''
rv A. i
7
J *
>;
Call for
PHILIP MORRIS"
This
State and
7
/'■ v71' v?
•;
•''V
- c
munity
who has used local newspaper .advertising to uncover a
high type of prospect.' .' •
'
yff: The ads appeared once a week beginning last spring. They
were
always the same, size—two-column by six inches.
The lay¬
Municipal
:
M■.}:•; .'-■> ,l:
7.''v
••
»,
•
'J1'..
very
•
outs
also
now
■N:D;Ss3Myi;'s
B 0
.
in
followed
its
45th
the
fa
NEW YORK 5
fi
7
1
123
-
used
PHILADELPHIA
Telephone IIAnover 2-2280
week
ran
9
*.:
'
*'
-
•'
7;1 ;V
.7
' V- 7,'--
••:.
:Y.7:-'.'.7
-
.
.
77
;■
,
.-i
7
>";V
<■ •
October 18, .1943.
THE
HOLDERS
L. G. HANSON, Treasurer.
7
--The Garlock
•
•
'
:
OF
XYZ
k
Munieipal News & Notes
Ajbanking
Blyth &(
headed
group
by
Co., Inc., Kaiser & Co. and
John Nuveen & Co.
the
was
suc¬
cessful bidder for the $6,000,000
Imperial Irrigation District, Calif.,
electric revenue bonds, eighth is¬
sue, which were offered at com¬
petitive sale
last
Friday.
The
banking group has deferred reoffering of the bonds, so as to
cooperate « with < the Third War
Loan drive currently under way.
The. $6,000,000 bonds are dated
Oct;
1, 1943, and mature
1 from 1945 to
July
1973, inclusive.
The 'purpose
to
j
acquire
of
the
on
issue
the
electric
is
power,
system of the California Elec¬
tric Power Co., located primar¬
ily
1
in
Imperial
Valley
in
and
Allocations
cated
American Canal.
ties
of
number
the
of
the
Ail-
Power facili¬
Canal
consist
low-head
of
drops
a
at
;'f which ultimately there can be
developed some 90,009 kilowatts
will
s
store
liquor stores.
The
7
-
1943
net
with
Blyth
&
Co.,
Inc., Kaiser & Co. and John Nu¬
& Co. are:
veen
Stranahan, Har¬
Co., Inc.; B. J. Van Ingen
&
Co.,: Inc.; Blair & Co., Inc.;
E. H. Rollins & Sons,
Inc.; A. C.
Allyn & Co., Inc.; Otis & Co.;
Deap Witter & Co.; Weeden & Co.;
Pairie Webber, Jackson &
Curtis;
Stofye' & Webster and Blodget,
Inc1.; Estabrook & Co.; Barcus
ris
&
Kindred
& Co.; Braun, Bosworth
Co.; R. S. Dickson •& Co., Inc.;
The Illinois Co. of
Chicago; First
of ' Michigan
Corp.;
Bosworth,
Chanute, Loughridge Co.; AllisonWiUiarps Co.; Boettcher & Co.;
&
McDonald-Coolidge & Co.; Stone
&
Youngberg;
Ryan Sutherland
& Co.; Peters, Writer &
Christensen, Inc.; Mullaney, Ross &
Co.;
Nevyburger,
Loeb
&
Co.;
First
Cruttenden &
Cleveland Corp.;
Co.; Thomas & Co.; Moore, Leon¬
ard & Lynch; Martin, Burns &
Corbett; Kalman & Co.; J. M.
Dain
Fox
&
Co.; Thos. Kamp & Co.;
Reusch
&
Co.; Dahlberg,
Durand
&
Co.
and
F.
Brittain
Kennedy & Co.
Call
stamp-tax
and
paid
cigarette
to
cities
Amounts will
monthly
to
road-users
first
for
revenues
ties will be given approximately
$135,000
extra
increases
.permit
cities
in
annually
costs.
and
from
customer
South
towns
liquor
Carolina
will
receive
share State-collected liquor and
motor vehicle excise taxes.
A
Wisconsin
Municipalities of
a
jfor
new
or
increased
taxes
shares
and
of
the de¬
velopment of new sources of in¬
dependent
local
revenue,
the
American Municipal Association
^reported Sept. 23.
j
Cities and counties in Arkansas
will
receive
share
of
for
State
the
sales
first
tax
time
to
municipalities 75%
drivers'
license
aminations
cally.
of
when
ex¬
conducted
reappropriated
nicipalities
$1,000,000
State-collected
funds
WRITE.
A
to
mu¬
as
city
town
and
California
and Washington en¬
legislation providing for di¬
appropriations to local govenable them
urning
nties.
of
-
over
admissions
$1,000,000
and
en¬
taxes,
year to
a
Florida authorized munic¬
ipalities
to
impose
and
collect
reasonable
charges for garbage
and refuse disposal and for the
use of all municipally-owned fa¬
cilities,
while
Minnesota
and
Washington have authorized cities
to
impose reasonable rates for
Garbage collection, the Associa¬
tion
said.
or
a
collec¬
all
trunk
highway
within
portions
Tennessee
cities
on
and
from
system
and
lots;
bought
and
recon¬
State
located.
villages;
a
exempting
payment
allowing
the
of the
measure
gasoline
gallon
act
requiring
construct
cities
of
in
taxes
3,200-
Arkansas
an
issuance
of
free
automobile licenses for vehicles
owned
by
dealer
himself.
KEEP
AT
IT
will uncover
HUMAN, INTERESTING, CONVINCING, and
YOU
UNTIL
successfully—once
you
GET
RESULTS.
It
be
can
done
Preferred
is
investment Policies
amortization
—
one
velopments of the last few years—
help to check the increase in
farm
values.
Whether
tion
is
a
shall escape infla¬
matter about which one
we
feel particularly hopeful.
Certainly free enterprise alone
promises little in this direction.
cannot
Free
enterprise is not competent
a situation created during
to meet
period of total war, which has
involved an unexampled increase
in the purchasing medium.
We
a
shall
only escape inflation in the
that the community is de¬
termined to prevent it and up to
the present time it cannot be said
event
a
deter¬
counties,
incorporated villages.
cities
and
Although this
is not the occasion for a political
speech,
I
think
I
may
be
par¬
doned if I call attention to one of
the
recommendations
Capital Stock, and
seventy-five
cents
<75?)
dividend
a
share
per
of
the
on
the close of business
on
at
September 30. 1945.
i
GEORGE MIXTEH, '
September 21, 1943*
Trcasurcr.
The Western Union
Telegraph Co.
DIVIDEND
A
dividend of
NO.
268
s
\
50 cents
a share on the capital
has been declared, pay¬
able October 15, 1943, to stockholders of reeo'd
at the close of business
.Sn<v^mb'r 2h "143,
stock
of
this
company
G.
September
14,
K.
HUNTINGTON. Treasurer.
1943,
"
.
very
of
adopted then let
us
f
,7
the
Re¬
publican Advisory Council on Do¬
mestic Issues.
It is suggested in
the report of the Council .that "as
deluge of inflation. If "as
promptly as possible" means as
soon
is
as
open
advisable, then the way
for careful' consideration
of
the appropriate timing for the
elimination of rationing and price
fixing. I should then say that the
appropriate timing must depend
upon the length of time required
to
reorganize industry until it is
able to produce adequate
supplies
of civilian goods.
This seems to
me
the
most
important
While
during the period imme¬
diately following the war.
As
I
said
at
the
outset,
I had
it in mind to discuss certain other
matters,
particularly
vestment
certain
unlikely
advance.
hardly seemed worthwhile to dis¬
cuss
such matters if it should
our
fate
to
through
pass
be
the
period of social and economic dis¬
organization that would follow
year
two
or
of
wild
Moreover, I understand that
remarks here
are
the nature of
a
discussion
from
the
ble" may mean immediately upon
adeauate basis for
the return of peace.
cussion.
that
I
or
prelude to
fancy
pressed
more
have
sufficient
a
inflation.
floor,
my
a
effects.;
dominant factors in
picture
2.
tions.
3,
taxes
and
ex¬
disputable opinions to provide
an
general dis¬
us
to
,:77/77?:7;■: ■; ,:7 A''';>7.
chasing
power.
7
public
dislocation
and
occasioned
of
war-time
to peace-time uses.
industries
many,
tically
a
period
readjustment
by the necessity for the
conversion
longer
pur¬
7-;
v
Naturally, there will be
of
excess
limita¬
profit
Unprecedented
six
facilities
In few, if any,
should
than
this
require
months
and,
production should be
uninterrupted.
as
a
in
prac¬
With
lesion of World War I
the
guide,
this prospect may have but little
is
I
to
Substantial relief from
profits
on
and
seem
1, Huge pent-up demands for
both durable and consumers goods.
.
effect
already
»-
The
the post-war
be:
which
of
a
be
extent
free
number
a
to
in
causes
in
less
the
followed exactly
or
in time, like
usually give rise to similar
either
in¬
of" rapid
But
it
consequences
technological
that
recognize
we
pattern of the previous conflict is
affairs
promptly as possible rationing,
price fixing, and all other emer¬
gency
powers
be
terminated."
The phraSe "as promptly as possi¬
If that policy
(Continued from page 1191)
mediately following the Armistice.
single
question of policy confronting the
country in the realm of domestic
7
Peace Is Bullish
all prepare
for the
(Continued from page 1215)
may
|
follow these principles.
Pest-War Trust
that mortgage
1
COMPANY
The
Advertising,
the prospects,"
in the newspapers,
but you must make it
this desirable end.
to
investment
business—it is imperative that a sufficient number of new customers
are added every month if a business
expects to grow.
either direct mail
MINING
Common
Capital Stock, both payable
October 15. 1943 to stockholders of record
next thing it should do-is to build confidence and
good-will on the
part of the firm's old customers, who when they read the ads will
be favorably impressed.
New accounts are the lifeblood of every
that there 'is evidence of
struct
CALL
call at the office of the
a
Treasurer.
STATES" SMELTING
REFINING AND
newspaper
mined purpose manifest through¬
out the community to accomplish
act
to
or' by
to meet
emergency
war
conditions,
■.he latter State abandoned the
field
invited
its main
and
acted
tire
reader is
per
National
,
SIMPSON,
•
of the most desirable financial de¬
2rnments to
UNITED
replies to the ads come in they are shown
consideration.
From here on it's a matter of
is the case in every other contact with a new
annually
streets.
rect
the
$1.50
of
been declared
to holders of
business October 15. 1943.
The Directors have declared a
quarterly divi¬
dend of \Yi% (87Vi cents
per share) on the
campaign should uncover new accounts.
That is
purpose—to attract inquiries, either by telephone, by mail,
highway
construction
of
and
8tock
Address77
St.
STATE.
firm's telephone number is played
up in
Attention is always called to the fact that
available
of
Light Company has
payment November 1, 1943,
ALEXANDER
the
and
selling the firm
*
FIRM
Company
DIVIDEND
dividend
Preferred
$6
&
record at the close of
the
prospective customer.
,
for
maintenance
When
courtesy
every
is
OF
AND
quarterly
the
on
Power
for
STOCK
PREFERRED
regular
sharo
lo¬
The North Carolina Leg¬
islature
of
fees
are
State
dozen States
jwere benefited this year by the
I passage of legislation providing
! State-collected
cates
allo¬
measure
CITY
instance
information
more
NAME
•
prominent position.
allocations
time, and municipali¬
each
In
a
or
receive
•
7
ac¬
cities within the county. Oregon
from
7; Tel. Number
be
counties
cording to population ratio; half
of the money will then go to
will
stock of the
common
R. M. Waples, Secretary
Today for Further Information."
suggestions are only a few of the attractive in¬
vestments we can submit to you for the reinvestment of the
proceeds from your
preferred stock.
Legislature
from
collections
counties.
the
on-
business September 18, 1943.7
Write
or
Wisconsin
Municipal Revenue Sources
j
declared
Company, payable September-30, 1943,
to stockholders of record at the close of
These
Other financial aids provided
for cities this year include a
| State Legislatures Increase
cease.
$8
a
Kansas
revenues
,
a
National Power & Light
provided for distribution of 75%
of
new
'7 Associated
investment will
269
special meeting of the«Board , of
Directors,-held in Palmyra, N. Y., this
day, a dividend of 50tf per share was
At,
,
The
Washington municipalities will
be applied chiefly to purchases of properties and to con¬
solidations and improvements.
$„__ share,
municipality's
profits of all State
total
to
ceeds from the sale of the bonds
Pro¬
power.
COMMON DIVIDEND No.
at
a
will
hydroelectric
this
September 16, l'J43
;
of the ratio of
the basis
on
about $300,000 a year from mo¬
tor
vehicle
license
fees, and
of
from
something else that will go right on—as it
always has—in good times or bad—in war or peace—when
your income is high or low—it's
based
be
than
profits earned by
the
from
STOCK.
500, which
THE COST
will receive a flat sum of $200 a
OF LIVING.
year.
Alabama cities have been
Today, more than ever before, your income should be
granted 20% of the profits of the
continued.
Living costs and taxes are rising daily.
State liquor monopoly to be allo¬
77^7;/:-'
Other Sound Investments Are Available.
cities
water
of less
towns
that pa!rt of Coachella Valley in
Riverside County which is irri¬
by
and further dividends
population except in the case
on
of
PREFERRED
April 1st these shares will be retired
But there is
tions.
gated
;
On
Company
Packing
7
hi
7
;
v.7.'7>*"V'
(Important Notice)
TO
v
.
,
/
•
7'
^7"
.•
Bell System Teletype NY 1-106
7
.-
.
respective series
close of business on
7
"
There also has been declared a regu¬
lar quarterly dividend of 75r per share
on the Common Stock, payable October
15
1943 to holders of Common Stock
of'record at the close! of business on
October 4, 1943.
•11
; / '•'
the
at
record
of
after,week.
j.7''.
1
rr*;
Preferred Stock of the
last
investors who read them:
Telephone Kingsley 2400
Series, have been declared pay¬
1, 1943 to holders of
November
able
were
HEADLINES.
Here is a sample of one of the ads the
spring—its timeliness and the manner in which the
subject was presented is indicative of why such ads created inter¬
est, good-will, and eventually led to action on the part of many
Street
South Broad
quarterly dividend of $ 1.06 V\
A regular
share, on the Cumulative Preferred
Stock, 4'A%
Series, and a regular
quarterly dividend of $1,12 Vz per share
on
the
Cumulative Preferred Stock,
41/a%
themselves
UNUSUAL
firm
Members New York Stock Exchange
72 Wall Street
September 21,;1943.
7'V
7;-;»•
::7i.7,;'7'
7
per
designed to gain attention BY THE
Next the subject-matter was
based upon a HUMAN APPEAL. ; Statistics,
figures, involved analytic
cal statements were never given prominence, but in their stead
plain
talk about subjects that people could understand continued to be
dUBLKStCLARK & !CO.
'• 7;
Philip Morris & Co. Ltd. Inc.:
is
-
ads
OF
USE
»
The a series
week.
every
advertising is bringing results,
even though
the campaign was conducted throughout the. summer
months when business is ordinarily less active than in the fall and
The
.,7
pattern
same
:;7v77-
week—consistent
winter.
^rf7
New York, N. Y.
,
,
,
'• >'
give
investment
likely,
primary
longer-term
we
sentiment,
believe,
thought
period
of
to
to
the
promise
rather than to the relatively brief
period
of readjustment.-
—
From
"The New York Letterissued by
Hugh W. Long & Co.
^«WW»W«NW^
.
?;■?£;.■': ■V.V:?''^r•:■ -^;'i^ --:•:'■
Volume 158
-
h:/
t.>.i^.^V;-'::
Number 4214
cj
THE COMMERCIAL & FINANCIAL CHRONICLE
w
1217
V
*
Annual Meeting
0n"Dealh Sentence" Transfer loMrals of
(Continued from
V,' .!.•/•>
■..,. •,
<4- % V\f.;.i\
(Continued from first page)
12th, prior to the opening of the
formal sessions.
;4: Officers
Divisional
Association's
\ were also
iheetings held
September 13th as part of the
elected
on
of : the
g r ou p s
at
annual
ABA conference.
1939, and increasingly as history
unfolded, investors were forced
to consider their position when,
as and if this country became in¬
president of the Trust division of volved. For public utilities are
the ABA.
Frederick A. Carroll, traditionallyj in an unfavorable
vice-president and trust officer position during a war period. The
the
National
Shawmut
Bank
of Boston, was named
vice-presi¬
c
F. Raymond Peterson, president dent, arid James W. Allison, viceand chairman of the board of the
president of the Equitable Trust
•First National Bank of Paterson, Company of Wilmington, • Dela.,
N. J., was elected president of the was made chairman of the
National Bank Division.
R. Otis
executive committee.
Five others
McClintock, president of the First
elected
National
Com¬
executive committee were: R. M.
of Tulsa, Okla., was chosen
vice-president of this division. In
Alton, vice-president in charge of
Trust Department, United States
addition;
National
Bank
and
Trust
pany
eight
members
were
elected to the division's Executive
Committee.
They are: Carl K.
Withers, president of the Lincoln
National Bank of Newark, N. J.;
Charles A. Boone, executive vice-
president of the First-Huntington
National
Bank
of
Huntington,
West Virginia; Thomas R. Hefty,
president
of
the
First
National
Bank of
ran,
Madison, Wis.; John Curvice-president of the Anglo-
California
National
Bank
of
San
Francisco, Calif.; George P. Shotwell, president of the Williamsport National Bank of Williamsport,
Pa.; Kendall
G.
Seaton,
president of the Second National
Bank of Ashland, Ky.; Gordon D.
to
membership
the
on
Home State Bank of Kansas City,
elected
were
to
division's
the
president of the Liberty
State Bank of Dallas, Tex.; James
C. Wilson, president of the First
Bank
and
Trust
Company of
Perth Amboy, N. J.; A. T. Hibfoard, president of the Union Bank
and
Trust Company, Helena,
Mont.; C. H. Martin, president,
Security Trust and Savings Bank
Ray,
of
San
Public Utility Securities
of the legal work
cause
the
did
trustees
not
involved)
their
make
plan dependent on the inclusion
of NYPANJ.
the
new
greatly
moval
bargo
event,
top
company
improved
of
the
ability
of
to contribute income to
the SEC
by
has been
recent re¬
dividend
Metropolitan
on
em¬
Edison,
which is currently earning about
preferred divi¬
dends. A substantial embargo still
exists against dividend payments
$2,754,000
after
by the second largest system com¬
New York State Electric &
Gas, due to requirements set up
Carlton by the Public Service Commission
Diego, Calif.; G.
pany,
Hill, vice-president of the Fifth- of New York.
Third Union Trust Comany of
The trustees' plan, which has
Cincinnati, Ohio; R. E. Gormley, been approved by the Special
vice-president
of
the
Georgia Master appointed by the Federal
Savings Bank and Trust Company Court and is now being considered
of Atlanta, Ga.; A. R. Vogtsberger, by the Court and the SEC, is com¬
vice-president of the Bank of paratively simple in scope, though
Menomonie,
Menomonie,
Wis.; necessarily complex in detail. It
and Ellwood Brooks, president of provides for new funded debt of
the Central Savings Bank and about $19,000,000,
as
contrasted
Trust
Company of Denver, Colo.
Savings Division
with
the
top companies'
debt structure of some $218,000,000) plus 7,500,000 shares of new
present
Fred F. Lawrence,
treasurer of common stock. The new stock is
Savings Bank, Port¬ given an estimated book value, in
land, Maine, was elected presi¬ the pro-forma balance sheet for
dent of the Savings Division of the new company, of about $11.30.
the ABA.
H. R. Templeton, viceBased on the pro-forma income
president of the Cleveland Trust account, net income would amount
Company, Cleveland, Ohio, was to about 65 cents a share after al¬
elected vice-president.
The fol¬ lowance for 5% interest on the
the
Maine
lowing
seven
members
were
new
debt.
This income statement,
elected to the division's Executive
however, withholds from the top
company net income amounting to
president of the Worcester Five an additional 55 cents a share (due
Cent Savings Bank of Worcester, to
various restrictions,
or
esti¬
Mass.; Earl B. Schwulst, first mated use of cash by the oper¬
vice-president of the Bowery Sav¬ ating companies), making total
ings Bank, New York City; L. A. equity earnings of about $1.20. To
Tobie, president, Meriden Sav¬ describe the terms for exchange
Committee:
Myron
Converse,
F.
ings
Bank,
Meriden,
C o n n.; of old securities for new common
George W. Owen, Jr., vice-presi¬ would require too much space, but
dent and cashier, Hibernia Na¬ the largest issue, AGECORP 4/78,
tional Bank, New Orleans, La.; receives 30 shares for each $100
George Eccles, president, First bond, making the equity earnings
Security
Bank,
Ogden,
The bonds
Utah; per bond about $36.
Mervin
B.
France,
president,
Society
Cleveland,
Ohio;
first
for
and
vice-
Savings,
Fred
are
or
selling currently around 23x/2
about 6^ times such earnings.
F. Operating economies and refund¬
Spellissey, vice-president, Market ing savings
Street
National
Bank,
delphia, Pa.
the
Argentina and European neutral
countries have been warned by
the
United;
States
Great
and
Britain that'they will not recog¬
nize the transfer to neutral own-?
ership
of
any
enemy-owned
rights or interests in property in
Italy, said an International News
Service report from Washington
on Sept. 21, which added:
The action has been taken fol¬
why
utility" stocks lowing receipt of reliable informa¬
should be sold, and they hit a new
tion that an important German
low average price in April, 1942.
industrial firm has been trying to
These being the
reasons
for dispose of its stock in its Italian
present market levels, the ques¬ affiliate to a neutral concern.
tion may now be considered, "Are
A State Department announce¬
they permanent?" The concensus ment also said that certain con¬
of investor opinion is that they
cerns
in neutral countries con¬
are
not, and the proof of that template acquiring or purporting
opinion is that investors have to acquire enemy-owned shares in
bought utility common stocks in Italian
companies
and
other
" reasons
likely
Kan., was named vice-president.
In any
The
following 'eight members NYPANJ
Executive Committee: De Witt C.
tion, and profits go down. There¬
by, something new was added to
Righls In Italy
-
assets in Jtoly.
enemy
officer, Florida National 18 months. What is more, it is
Seaboard Air Line Ry.
Bank, Jacksonville, Fla.; T. Stan¬ possible to see why. From a longley Holland, vice-president and range point of view it is apparent Situation Interesting
trust officer, American Security that the body of administrative
L.
H.
Rothchild
&
Co.,
120
and Trust Company, Washington, regulations
has
distorted
the
Broadway, New York City, have
D. C.; and Howard C. Lawrence, framework of the new regulatory
prepared a brief study on the pro¬
executive vice-president, The concepts into a shape unrecogniz¬
posal to retire the receivers' cer¬
Michigan Trust Company, Grand able by its legislative creators. tificates and
other
outstanding
And
such
a
condition
is
most
Rapids, Mich.
bonds of the Seaboard Air Line
top
company
w o u 1 d
greatly
strengthen the setup, but in view
The State Bank Division of the
of the uncertainty regarding com¬
ABA elected Wood Netherland,
pletion of this rehabilitation pro¬
vice-president of the. Mercantile- gram over the near future (be¬
pany of St. Louis, Mo., president.
Claude F. Pack, president of the
obvious—costs go up,
are fixed by regula¬
are
selling prices
German
and trust
....
Commerce Bank and Trust Com¬
reasons
Bank, Portland, Oreg.
(on military leave of absence);
Chester R. Davis, vice-president
and trust officer, Chicago Title
and Trust Company, Chicago, 111.; such volume that the Dow-Jones
W. H.
Goodman, vice-president average has doubled in less than
4 (Continued from page 1195)
Palmer, president of the First Na¬ ries of thirteen steps to "un¬
tional Bank of Tuscaloosa, Ala.;
scramble" the NYPANJ system
and Taylor S. Abernathy, viceand retire the small amount of its
president of the First National securities held
by the
public.
Bank of Kansas City, Mo.
Merger of NYPANJ with the new
State Bank Division
page 1213)
Henry A. Theis, vice-president
of the Guaranty Trust Company
of New York City, was elected
of
National Bank Division
Savs— ; ■: 4/4 44|4f ■
Slay J Allies Hot toBecopize
When World War II broke out in
Trust Division
are
expected to swell
Phila- future earnings/but Federal taxes
remain the most important
factor.
'
Tomorrow's Markets 4
Walter Whyte
I
Heed Wartime
American Bankers Association Holds 6Stii
to
be
corrected
whenever
Railway, analyzing the result of
such action on various outstanding
re-appraise its creature.
When issues.
Copies of this interesting
that happens, regulation is likely
analysis may be had from the firm
to swing from its extreme, puni¬
upon request.
tive position to a normal, work¬
the legislative body finds time to
able status.
Cons. Textile Attracive
With respect to the war, it be^
to be
gan
United
1942 that the
in
seen
:
fortunately the market
gives us other handles to
grasp. 4 For one thing the
market seldom acts
And for another
unit;
as a
nobody buys
(or sells) the market.
Our in*
terest while
being academic¬
ally in market action is com
cerned
primarily/ with iri|
dividual
there
stock
certain
And
action.
things become
clear.
>
4
<
/.•
;
-'•
V
.
;■>
*
'-V* 4
r
*
."'V'"'-
'*
4/4:4/.\. 4•
sk
a market which
intention of going td
Ordinarily
has
no
highs, seldom: has more
few stocks making new
highs in advance of the marl
ket as a unit. The opposite ii
true if a •new higlr* isrim
dicated. If you take a look at
any complete stock market
table you will see any num¬
ber of stocks have already
made new highs. In addition*
to such signals you will also
new
than
find
a
that
few
stocks
carry
through on any down tenden¬
cies.
Buying of one kind or
another
comes
in
at ; the
psychological moment, and
either stops the potential de¬
cline dead in its tracks
Consolidate Textile offers inter¬
1
(Continued from page 1194)
But
or
is
sufficient to turn the retreat
current into an advance. It is in this
possibilities
at
emerging esting
phase and levels, according to a memoran¬
latter group that danger of
reaching a point where they could dum issued by J. F. Reilly & Co.,
take the offensive.
That meant Ill Broadway, /New York City. serious losses is comparative¬
that the time of peace became a Copies of this memorandum may ly small.
Such stocks are not
factor to be considered, and utility be had from the firm upon re¬ too
close to old resistance
stocks could be appraised shorn quest. 4 44//44/4 44/44-/444444/
levels
to
make
them too
of their depressing, war-time sta¬
tus.
An Act of Congress, more¬
dangerous and are close
from
Nations
were
defensive
the
contributed in no small way
change in sentiment. The
1942
tax
law
recognized
the
special position of public utilities,
and embodied an adjustment in
Wittich Back From Coast
over,
Wilbur
the
to
their favor.
bered
had
been
by
years
this
To those who remem¬
vividly
how
around"
"kicked
a
action
utilities
the
far
impor¬
tant in its implications than in its
more
immediate effect.
To
son
up, then, there is rea¬
to believe that the market for
utilities
will
improve
over
a
period of time. «To execute the
sentence
Wall
visit
647 South
interpreted by
as
the SEC now, is to enforce liqui¬
dation of the typical holding com¬
in
a
market
to
The current situation in Denver
Grande
of
4s
cons.
tributed
by Pflugfelder, Bampton
Rust, 61 Broadway, New York
City, members of the New York
Stock Exchange.
Copies of this
&
circular may be
from the firm.
had
request
upon
viewpoint,
MacBoyle Lewis Goes
pared
period
holding
To Cruttenden & Co.
as
,
sells its
company
the investors
in its stock
assets,
are
au¬
tomatically being sold out, too.
Granting that a normal period is
recognized only in retrospect, the
fact remains that a war period is
abnormal, by its very terms. A
stay of execution on the death
sentence for
the
duration
of
the
abnormal period is necessary to
accomplish one of the purposes
of the Holding Company Actprotection of the investor.
CHICAGO,
ILL.
Cruttenden
FIC Banks Place Debs.
offering of $23,900,000 0.85%
consolidated
Federal
debentures
Intermediate
of
MacBoyle
York
&
Co., 209 South La
Street;' members of the New
and
Stock
Chicago
department,
Ex¬
was
it is announced. He
& Hutzler In Chicago.
1856
Stock
Exchange
by Charles R. Dunn, New York,
fiscal agents for the banks.
The
debentures are dated Oct. 1, 1943
New
Cotton
Exchange
1,
the
1944.
sale
of
The
York
Chi c
New
a
g o
Orleans
At
the
close
of
business
1943, the banks will have
of
$274,495,000
standing.
views
And
of
coincide
with those of the
They are presented as
STREET
other Exchanges
the
debentures
1,
total
out¬
Y.
Trade
Cotton Exchange
SUGAR
N. Y. Cotton
Exchange Bldg.
NEW YORK 4, N.
.
Exports—Imports—Futures
Y.
Oct.
a
-
$$hyte
expressed -in this
necessarily at any
NEW YORK 5, N.
debentures will be used to pay off
$30,215,000 debentures maturing
Oct. 1,1943, the balance of $6,315,000 being met from cash on hand.
—Walter
99 WAU,
Inc.
Exchange,;:
Board
| x„•
Thursdays
LAMBORN & CO.
Exchange
Curb
July
More next
■}X.
Members
Commodity
w
i
H. Hentz & Co.
York
from
'
those of the author only.] ^14
York
mature
at 35.
[The
New
and
are
the stocks;1 and
prices at which they
should be bought. AllegheriyLudlum Steel, buy at 27, stop
at 26. Allis Chalmers, buy at
38, stop at 36. Atlantic 'Re¬
fining, buy at 27, stop ^26.
Commercial Solvents, buy at
14^, stop at 13. U. S. Pipe
& Foundry, buy at 34, stop at
32.
White Motors, buy at: 21,
stop at 19. Yellow Truck, buy
at 17, stop at 16. Youngstown
Sheet & Tube, buy at 36; sftop
Chronicle.
the
CHICAGO
DETROIT
GENEVA,
PITTSBURGH
SWITZERLAND
a
points.
or so
Here
time
New
proceeds
2
the
article do not
Cre d it
was
setback of say
formerly with Salomon Bros.
made Sept. 20, at par,
Banks
point out that current gen¬
changes, as manager of the sales
Established
An
—
Lewis has become associated with
Salle
few such
1936
interesting possibilities, ac¬
cording to a circular being dis¬
surely low as com¬
with
any
more
normal
in the future.
When a
and almost
a
eral market action indicates
unquestionably
low from the historical
have
recommend them I would like
pany—to force the sale of its as¬
sets
I
Spring St., Los Angeles,
Rail Situation Interesting
Rio
levels.
stocks in mind but before I
California.
&
enough to old support points
to permit of reasonable stop
office,
home
firm's
the
to
offer
sum
death
40
for
creature of Congress,
was
"Wittich, manager of the
Wyeth & Co.,
St., has returned from a
New York office of
DIgby 4-2727
1218
THE COMMERCIAL & FINANCIAL CHRONICLE
Thursday, September 23, 1943
VTrra^n Charges Some Corporations' Conducted
Advertising Campaigns At Expense Of Govt
.Y,
The allegation
that some corporations have conducted extensive
campaigns of promotional advertising chiefly at the expense of the
Federal
Government
made
was
Sept.
on
17
by
Senator
Truman
(Dem., Mo.) in an article in "The Progressive," La Follette weekly
magazine.. \y
The, Senator, who is Chairman of the committee investigating
the national defense program, de-^
clared that it was. "only natural"
that
establish
good-will
consumer
are
anxious to continue their ad¬
vertising
with
their
campaigns
Hearings
and
keep
public." j;
In special advices from Madison,
Wis., Sept. 17 to the New York
,"Times," it was further reported:
"This practice would be per¬
fectly proper if the corporations
paid for their advertising out of
profits after taxes and renegotia¬
tion," he wrote. "Yet here is what
their
before the
names
is
happening with respect to ad¬
vertising.
The
bulk
of
this
expense is
being borne not by the
corporations but by - the Federal
Government.
these
This
is
because
so
advertising costs
being
doing
business before computing profits
treated
an
are
of
expense
which the Government is
on
titled
'
as
en¬
excess
profits
highest rate. In other
words, the advertising costs the
corporations practically nothing
because
the
foots
taxpayer
the
bill."
Asserting that "for the most
part
American
advertising
has
told
the
truth"
advertising
and
claims
that
"most
fair
are
and
justified," Senator Truman said,
however, that some corporations
had published advertising to off¬
set
"just criticism"
leveled at
them by the Senate committee or
other agencies.
.
.
.
Disclaiming any intention of
suggesting that "American arti¬
cles of
which
war
advertising claims are
large to be distrusted,"
by
and
he
con¬
tinued:
"Shoutings in self-praise at the
taxpayers'
expense
healthy. The
Bureau
not
are
of Internal
Revenue should investigate these
advertising
costs
and
a
new
scheduled
Sept. 20 before
to
the
amounts
entitled ! to
rent
but
be
brought
the latter part of next
may
$15,000,000,000, Third
Loan drive
senting
additional
revenue.
also
reports
been
raising
for
program
There
have
conflicting
tax views as delaying the Treas¬
ury
Department's
tax
program
whereby it seeks to raise $12,000,000,000 in new revenue—a goal
which
Congressional
many
experts doubt
The
House
tax
be achieved.
can
Committee
the
for
past two weeks has been holding
hearings
in
the
to
as
changes
possible
contract renegotiation
war
law.
The group has also launched
studies into methods of simplify¬
legitimate
excessive
business.
expense
profits.
greater than those incurred before
the Hvar. On top of
that, advertis¬
ing references to contributions to
the war effort should be carefully
increase in the normal rate to
an
10% and perhaps lower personal
exemptions. This merger of the
Victory and normal tax was en¬
upon,
Press
Associated
advices
reported
^
„
Also under discussion
plans
a sharp increase in social se¬
curity
taxes
and
compulsory
savings.
are
for
"No
Grande Western
Railway, and the Nassau & Suf¬
Lighting Company both offer
interesting speculative opportun¬
ities according to circulars being
distributed by Ira Haupt & Co.,
Ill Broadway, New York City,
folk
with
state
how
they may
out," he said.;:
best
Advocated By Presidsitt
1
foreign policy should be
based upon the absolute necessity
for the preservation of our iden¬
tity as a nation and on our tra¬
freedom of action
ditional
In
address
an
national life.
"We
a
do
not
want
service
also
as
a
means
of
quoted
Mr.
Johnston
V
the
am
keenly
aware
that
conditions.which confront
today
of
also
are
us
by.
The
bomber
has/ shriveled distances and made
into
oceans
lakes.
Our
armed
forces must be adequate to insure
in
Exchange and other leading ex¬
changes. Copies of these circulars,
discussing each situation in detail,
world where time
a
have
meaning.
new
lest
arise from
ing
hopes
or
that
cannot
adding:
own
we
do not know
we
minds,
the
making promises
fulfilled, he said,
be
"If
distrust
encourag¬
shall exhibit be¬
world
a
and
talk
and
.
double
dealing
not in the great traditions of
American
diplomacy."
D.
Kobbe, Gearhart &
Pflugfelder, Bampton & Rust, 61
Broadway, New York City, mem¬
Nassau
returned
from
published "Railroad Securities in
Harvill
the Post-War Era," which repre-
craft
is
our
of
diecasting
supplies
in
one
the
many
modern
Jr.
of
Inc., 45
City, has
California,
where he inspected the
of
North
it
admitted
is
semi¬
officially that, with German forces
in complete control of northern
Italy, Switzerland is more cut off
from
the
world
emphasized
in the
than
that
the
it is
§ver,
Swiss
early
—Net assets
as
no
The
recent
August 31, 1943,
totalled $16,567,223, equal to $90.07
per
share, compared with $12,507,259 or $74.08 per share a year
earlier.
.
ing dividends payable Sept. 30,
1943, to stock of record Sept, 17:
Agricultural
Reg.
Extra
.05
properties
Harvill
the
Corp.
larger air¬
concerns
which
of the parts used
war
planes.
Mr.
Security Traders Association, Inc.,
Gearhart also discussed the post¬
held in Chicago on Aug. 20.
war
prospects of the company.
Total
.02
.07
.085
.10
.06
...—.015
.11
Aviation
.05
Building
.02
.04
Chemical
.04
,02
.09
.04
.04
.04
.065
.055
——
Mach,_;
Company
Petroleum
Equip
^
.01
■
•
> >.
.05
.08
.12
.08
__
.03
.03
____
.03
.06
.05
.02
.07
.06
__
—
curred
in
August, 1942, when
Randolph Paul resigned upon be¬
coming General Counsel of the
Treasury.
The Board also announced that
mainder of the current year.
Cornell University.
ess
Railroad Securities
swings it had been demonstrated
that specific reorganization devel¬
key to price
reorganiza¬
tion railroad bonds.
Progress in
opments
Gap}, John Bodfish
Bodfish, of Chi¬
who was stationed at Spadre,
California, with the Desert Train¬
ing Center, died in Pomona, Cali¬
fornia, on September 19th. He was
cago,
leave
on
of absence
as
Treasurer
and
Secretary of the First Federal
Savings and Loan Association of
Chicago, and resided on Butter-
Road;;
Flossmoor,
near
Il¬
f
Captain Bodfish's death occurred
as
result
a
lowing
weeks
of
an
complications fol¬
appendectomy
two
The body is being
ago.
to
Chicago
taken
for
burial
on
September 24th.
an
27 years old.
Medical
Utilities
.02
—
„
.03
.06
was
commissioned
a
First
bonds of the
in periods of
market weakness.
Now
of more
rapid reorganization progress for
a large number of roads, there is
a
widespread feeling among rail
men that market
stagnation is a
virtual
impossibility. This is par¬
ticularly true inasmuch as even
though earnings in* many instances
have been dropping below year
earlier levels they are still ab¬
normally high and cash will con¬
tinue to accumulate at a rapid
for
rate
a
considerable
time,.to
at least.
,
?'
■
..
Bank & Insurance
Lieu¬
to
Spadre
some
months
(Continued from page 1195)
third
of
the
list.
On
the
*
other
'•$ hand, Bank of America National
Trust and Savings Association is
widow,
the former Jeanette Havens, two near the top in point of size but
close to the bottom as regards
daughters, Jean Havens and Mar¬
is
survived
by
his
garet; his father, John H. Bodfish
.04
.02
Sept. 30.
& Clark Fund
market ratio.
Neither
of
dividends
size, current earnings,
nor
Security Analysts
to Hear
book value, neces¬
sarily determine the market's ap¬
praisal of an institution, nor the
degree with which it is favored
by investors; more often the de¬
terminant is
something
tangible and
even
more
in¬
elusive. We
are
of this opportunity to give
Capt. Sergei N. Kournakoff will space in this column to Mr. Wood's
glad
address the New York Society of
remarks.
Security Analysts, Inc., on Friday,
Sept. 24, on "How the Red Army
Fights."
Trend Of
On
be
a
Monday, Sept. 27, there will
discussion of post-war pros¬
Deposits Of
Reserve Member Banks
M. A. Schapiro & Co., One Wall
leadership of E. R. Sterling of Street, New York City, have pre¬
Merrill Lynch, Pierce, Fenner & pared a most interesting table of
the trend of deposits of the mem¬
Beane.
pects of the utility industry under
the
,
,
B.
ber banks of the Federal Reserve
Earl
Puckett, President of
Corporation, will System since Dec. 31, 1941, with
speak on the corporation at the data on 30 selected member banks!
Analysts meeting scheduled for Copies of the table, with a discussion.of
the
possible future
Wednesday, Sept. 29.
No meeting will be held on Fri¬ changes "in the situation, may be
Allied
Stores
day, Oct. 1.
The Analysts
*:
Society meets at
at 56 Broad Street, New
had
from
upon
M.
A.
Schapiro &
Co.
written request.
City.
Empire Sheet & Tin Plate
.03
dend of 15 cents per share
payable
Oct. 15, 1943, to stock of record
■—A dividend of 75 cents
per
even
that there is the prospect
Administrative
.04
George Putnam Fund—A divi¬
Scudder, Stevens
prices for
involved
Corps, Army of the United States,
12:30 p.m.
.04
traditionally
general
He volunteered
the
York
Tobacco
has
sufficient incentive for ad¬
University of
MBA degree, he
Chicago, with
was
a
vancing
road
come
A graduate of the
in
individual
reorganization
been
John
the
were
of
trends
li
Captain
.08
__
■
prices as more than a flash in the
pan.
Even in the days before the
war was a factor in security price
.08
__
Mr.
Myers is head of the Department
of
Agricultural
Economics
at
(Continued from page 1193)
mobilization
Italy, would appear
adequately to confirm this stand.
.06
.03
Class C Direc¬
tor, had been designated Deputy
Chairman of the bank for the re¬
passage across
in
ernment
.04
.04
for
quietly carried out with the
capitulation of the Badoglio Gov¬
.02
Steel
York
of the term ;
this most recent upward surge of
.04
_
RailroadRailroad
.06
.09
.08
Priced
Merchandising
Mining
.06
;
a
meas¬
Group Securities, Inc.—-Follow¬
Class of Shares—
as
Federal
ending on Dec. 31, 1943. Mr. Cal¬
kins; fills the vacancy which oc¬
territory.
ures,
He
of
Dividends
of New
ReserveBank
adopted a stand of com¬
plete neutrality under which they
informed
all
belligerents
that
there would be
the
of
the unexpired portion
war
Swiss
York,
New
Director
C
William I. Myers, a
Though
Columbus, Ohio; two brothers,
"S4"—Net assets on July 31, 1943, Morton
Bodfish,
Chicago,
and
were $4,179,597 or $3.98 per
share, Lieut. Robert V. Bodfish, of the
as
compared with $2,524,115 or U. S. Marines Corps, and one sis¬
$3.17 per share on January 31, ter, Mrs. William Ohl, Youngs1943.
town, Ohio.
Investing
Co.,
St., New York
plants
to
University,
later.
Keystone Custodian Fund Series
Low
Gearhart
In The Post-War Era
and
broadcast
tenant, and went to Camp Robin¬
in January, 1943, being trans¬
(Continued from page 1196)
$15.54 per share six months earl¬
ier.
»'
'
Industrial
Plants In California
just
Swiss
cent
on
of the School of Business, Colum¬
bia
son
—
Frederick
^
America.
our
picture
of
opportunism.
General Bond
Gearhart Visits Harvill
doubt"
a
hatred
Electrical Equipment
Food
opportunity."
be had from the firm upon
as expressed at the corpo¬
meeting
of
the
National
of
and
Automobile
request.
Ginnis
shadow
stability should
"beyond
the
Fully Administered-
of
' l-i ,
Investigation
of
their
origin
brought indications that they grew
from a misinterpretation of a re¬
linois.
far different from those
gone
years
rumor:
field
known
an¬
Class
| This country's position in the
made
of the
System
Sept. 17, according to a tele¬
phone message to the New York
"Times" from Berne, Switzerland,
on
the same day, which also re¬
ported as follows Regarding the
on
be¬
lieve in collaboration among the
nations, we must put it in prac¬
tice among Americans."
we
nounced
Reserve
Sept. 14 the appoint¬
ment of Robert D. Calkins, Dean
Scudder, Stevens & Clark Fund
"It has been regarded as one of
the old world measures that we
but I
one-man
If
Investment Trusts
making replacements in the coun¬
try's peacetime force, according
to an Associated Press dispatch
from Omaha, Neb., on Sept. 21,
follows:
a
one-party peace.
Federal
manding transit privileges for the
German Wehrmacht through Swiss
territory were categorically de¬
nied in high Government circles
peace
our
de¬
ultimatum
an
"Never
our
prepared for the
space
.j&ents the views of Patrick B. Mc-
all
times."
Of U. S. Chamber
"Soldiers marching home from
the war must march into a land
have
at
received
ferred
and
securities,
carried
be
"Our
are
members of the New York Stock
change and specialists in railroad
this
may
had
be at the conclusion of the war, or
"Double
peace
bers of the New York Stock Ex¬
what
others
exactitude
nation's obligations to
fore
our
Railroad Securities
re¬
is wise enough now to
man
vacillation
didn't want in the United States,
Speculative Opportunities
follows
garding his remarks:
be
which
,
Philadelphia
as
creation of world
(Dem., N. C.), Chairman of the
as
founded claims."
coun¬
war's end.
dorsed by Representative Dough-
House Ways and Means Commit¬
tee.
:
? - • ?
1
scrutinized.
The taxpayer should
the cost of spreading un¬
this
that
policy should
the
necessity
or
not pay
rate
declared
foreign
based
rate in the interest of simplifica¬
tion. He said this might involve
normal
Finance
universal
event, should not be
reorganization
Bricker
Philadelphia, Governor
of
6%
Senate
and in
may
at
tax
the
American Legion convention, Eric
& Rio
lution
income
the
of
A. Johnston, President of the U. S.
Chamber of Commerce, advocated
Denver
of the Sons of the American Revo¬
with
doing
of
deliv¬
Society
and
National
Sept. 15
that the Victory Tax be combined
Chairman
Ga.),
(Derm,
But
any
Day
the
before
ered
on
George
advertising expen¬
be
paid by the
company down to the last dollar,
^
Constitution
ing
Committee, proposed
Senator
should
ditures
radio address commemorat¬
a
again," he said, "should
negotiations be directed
by those from only one political
party, from any one department
of government, or any one section
ing Federal income tax returns.
income
as
"Some advertising is proper and
a
bi-partisan delegation
government and sectional life.
In
of
is
The agencies in charge of
renegotiation should also inves¬
tigate and determine the amounts
as
Sept. 17 that this coun¬
negotiations be con¬
on
peace
ducted by a
known before pre¬
are
its
War
taxes.
to be returned
try's
be
for
preservation of our national iden¬
under way
He
week. It is understood that the tity and freedom of action.
also urged caution in the final
Administration decided
to
wait
until after the results of the cur¬ drafting of peace treaties at the
postponed
determine
Government
receive,
urged
Committee, have been try's
"
the
one-party peace,"
a
ton
inferior and that
are
tax
bill,
begin
the House Ways
on
were
and Means
receive
to
taxes at the
or
Governor John W. Bricker of Ohio
of
Delays Hearings
He# Tax Program
On
acquaint
product
and
the
one-man
representing various departments
House
companies which, in peace¬
"spent millions of dollars to
time
a
The Board of Governors
Rumors abroad that Switzerland
Asserting that "we do not want
Post-War Rail Prospects
McLaughlin,
Wall
St.,
One
members
Baird
&
Reuss,
New York City,
of the New York Stock
Exchange, have just issued an in¬
teresting circular entitled "Rail¬
roads—Some Thoughts on Post-
share War Prospects."
Copies of this
payable Sept. 20, 1943, to stock of circular may be had from the firm
record Sept. 9.
'
•/ upon request.
Situation Attractive
The first mortgage 6s and com¬
stock of Empire Sheet & Tin
mon
Plate
Co.
bilities
offer
attractive
possi¬
according to a memoran¬
Thompson
Co., Inc., 120 Broadway, New;
York City.
Copies of this inter¬
esting memorandum may be had
upon request.
dum prepared by Hill,
&
Volume
THE COMMERCIAL & FINANCIAL CHRONICLE
Number 4214
158
selling natural gas in 20 municipalities in
Georgia, and manufacturing, distributing
and selling artificial gas in five municH
OflNew Security Flotations
Calendar
Offering—Price to public 100 and ac¬
crued interest |rpm Aug. I, 1943,: to date
of delivery.
i; (:;V
•/ <': i
v1-/:'- i'-'r
Proceeds—Of the net proceeds, the com¬
OFFERINGS
palities in Georgia and two in South Caro¬
Incidental
lina.
the
to
promotion
of
/its
.
REPUBLIC
DRILL & TOOL CO.
Republic Drill & Tool Co. has registered
5"o
convertible debentures, due
mon
will apply $100,000 to retire its out¬
bank loan, $125,000 toward the
retirement of outstanding convertible pre¬
version
ferred
$1,250,000
pany
Aug.
standing
1,
shares of com¬
and 296,875
1953,
stock, par $1, to be issued upon conof debentures. •••/
—
Address-—322
South Green Street, Chi¬
cago.
.
Business—Engaged
and
sale
of
drills.
1
manufacture
carbon twist
'
Underwriting—Wyeth
and Los Angeles.
Co.,
&
York
' M
New
1,
'
and
stock,
the
balance
to
working
capital.
■
,
the
and
in
high speed
also engages in the,
of gas appliances.
It has
in the sale of gas continu¬
business, the company
•
merchandising
been
engaged
1856, except when its
damaged during the Civil War.
ously
was
since
Proceeds—Net
crued
Registration Statement No. 2-5197. Form
A-l. <8-11-43).
Registration
statement
effective
p.m. SWT on Sept. 15, 1943.
cipal
Sept.
Offered
1943
22,
100
at
int.
and
by Wyeth & Co. and Bond & Goodwin, Inc.
proceeds, exclusive of ac¬
and dividends, will be ap¬
extent that funds are avail¬
the redemption of $5,875,000 prin¬
interest
plied
5:30
the
to
able
to
of
amount
series due
list of issues whose registration statements were filed less than twenty days ago.
These issues
are grouped according to the dates on which the registra¬
become effective, that
course
is twenty days after filing (unless accelerated at the dis¬
cretion of the SEC), except in the case of the securities of
certain
foreign public authorities which normally become
effective in
days.
seven
Offerings will rarely be made before the day follow¬
ing.
DERBY GAS
ELECTRIC CORP.
&
Derby Gas <fe Electric Corp., a subsidiary
Ogden
91,577 shares
value with
registered
Corp.,
This
SEC.
stock
is
already
issued
and. outstanding, and the shares are not
being offered by or for the account of the
They are to be sold by Ogden
Corp., as part of its plan to dispose of its
public
utility
investments
in accordance
company.
with
the
Act of
Public
Address
primarily
Place,
Jersey
engaged
is
company
the
generation, distribution
electric energy and manufac¬
of
tured gas.
i
Underwriting—Ogden
Corp.,
after the
registration becomes effective, will publicly
invite sealed proposals for the purchase or
underwriting of these shares.
The result
the
of
bid opening will
be filed by amend¬
later.
ment
Offering—Terms will be filed by amend¬
Statement No. 2-5313. Form
%.
,
Registration
,
,
to
Garfinckel
with the
registration
shares
of
&
5V».3?
Co.,
Inc.,
Lines,
warrants
the
to
SEC
a
60,000
covering
value
par
$25 a share, and 19,990 shares of common
stocky $1 par value.
Address—Washington, D. C.
The
Business
a
department store at 14th and F
W., Washington, D. C., dealing
specialty
Streets,
operates
company
N.
various
includes
vice departments,
men's
and
other
retail
and
furnishings
and
clothing,
seini-precious
and precious Jewelry,
and
glassware, china
and
stationery
and
luggage,
linens
and
to
of
storage
number
the
of
unspecified
an
company's cumulative con¬
vertible 6%
tion
preferred stock on its redemp¬
Oct. 8, at $27.50 a share plus
date
dividends
accrued
from
1.
Oct.
of
stock,
19,990 shares of $1 par common
fully paid and non-assessable.
'
$18
surrender
shares
SUNDAY, OCT. 17
LORILLARD
registered
$20,000,000
shares
374,391
of
common
Business
West
40th
St.,
Manufactures
—
N.
City.
Y.
cigars,
cigar¬
tobacco, etc.. ;:.v'
Underwriters—Principal underwriters are
Lehman Brothers and
-
Purpose—Proceeds
Smith Barney & Co.
will be used to retire
$19,000,000 short-term bank loans and $5,209,600 7% bonds due Oct. 1, 1944. Bal¬
ance
will
be
added
to
working capital for
general corporate purposes,
Offering—It is expected that
mon
stock will be offered to
holders
stock
in
10,000
each
for
share
com¬
stock¬
of
new
share of present stock. The
be offered to
the public
debentures' will
uhderwriters.
by
Price
of
bentures will be supplied
Registration
stock
and
de¬
by amendment.
Statement
filed
.C
1943.
of
OF
present
Sept.
twenty
days
offering
mined
or
date*
or
list
a
more
have
21,
been
to
attached
rants
Business—Is
port
operations
and
Europe,
New
filed
stock
of
$110
at
a
Underwriting—To be filed by amendment.
Registration Statement No. 2-5211. Form
S-l.
(8-31-43),
CALIFORNIA ELECTRIC POWER CO.
California
tered
33/4
Electric
Power
first
$16,000,000
%\ Series
has
Co.
regis¬
bonds,
mortgage
and 40,000 shares
5(4% convertible prior preferred stock, par
value $100 per share.
Address—3771 Eighth Street, Riverside,
1968,
due
Business—Engaged
in
the
generation,
transmission, distribution and sale of elec¬
tric
energy.
<8-19-431.
S-l.
.
Amendment filed Sept.
1943, to defer
4,
effective date.
<v~
r'-
*
•""■.'''•-A!
A V "vv-''r- •''
v
'
'•' i
ARDEN FARMS CO.
Arden Farms Co.
statement
has filed
shares
26,000
for
registration
of preferred
a
stock, without par value.
Address—1900 West Slauson Avenue,
the
cream,
Los
Cal.
Angeles,
•
Underwriting—Principal
•
underwriter
for
the bonds is Dillon, Read & Co., New York,
and for the preferred stock Stone & Web¬
and
Blodget,
Boswor'th,
and
Inc.,
of
the
Association of
American tourists are crowding
Mexico,
buying
up
everything
New York opens on September
from "gin and
electrical appli¬
30th.
ances to bobby pins and elastics,"
Teams will bowl every Thursday Arch Black, export manager for
night at the Bowlmore Alleys on Norge Division of Borg-Warner
University Place near 14th Street. Corporation, revealed today fol¬
Games start at 5:30 p.m. and finish lowing his return from an exten¬
about 8:00 p.m.. *
y /
,
i sive trip through Mexico.
"The people of Mexico are not
All "games are on a< handicap
basis and all members of the As¬ feeling the war as acutely as are
sociation ;aire
'welcome—-both ex¬ the people of the United States,
as rationing has not gone into ef¬
perts and beginners.
Those interested should com¬ fect there," Mr. Black said. "There
is plenty of everything and, al¬
municate with one of the follow¬
ing who will give full details on though they appreciate the influx
teams and arrangements.
Friday, of American dollars, the Mexicans
September 24th, is the deadline to are getting a little peeved because
sign up with the committee. Tom American tourists are thronging
Gleason, Chairman, Kirchofer & through the country buying these
Arnold,
Inc.,
Hanover
2-8260; surpluses of goods they can't get
George Leone, Frank C. Master- in the United States. Som(* dis¬
son
&
Co.,
Hanover
2-9470; tributors even claim to have- reCharles King, Charles King & Co., shipped
American - made ' small
electrical
Whitehall 4-8980.
: d
appliances .again; into
the States."
y;.y;ni;* "
season
t
Chanute, Loughridge & Co., Denver. Other
underwriters
will
be
named
by
amend¬
/'v,
-'V
Offering—Price of both bonds and prior
preferred stock will be supplied by amend-
ment.
Proceeds—Proceeds,
received
certain
used
together with funds
by the company from the sale of
of
its electric properties,
will be
to
all
redeeem
the
of
trust
first
gold bonds, 5% series of 1956
outstanding after giving effect to
mortgage
to
be
the
surrender of certain
amount
will
on
of
of
be
the
3%
$641,000
first
pay
the balance
the face
proceeds
then
due
installment note held by Bank
National
America
sociation.
to
bonds in
Balance of
$641,300.
used
Trust
&
Savings
As¬
Upon the payment of such note,
face amount of the company's
.
mortgage trust gold bonds pledged by
as security for such note will
Mr. Black believes that electri¬
be
for
surrended
S-l.
(6-29-43).
filed Sept.
Amendment
11, 1943, to defer
effective date.
(This
is
list
incomplete
this
notified
its members on Sept. 15
ruling designed to discourage
speculation or "free riding" in
United States
Government
ities
in
offered
the
secur¬
Third
War
Loan drive.
the statement is¬
Schram,
President of the Exchange:
Following
is
sued to members by Emil
of
"In conformance with the spirit
a notice given
by the Federal
Bank
Reserve
banks
and
the
the
New
York
to
trust companies with¬
Second
New
of
Reserve
Stock
York
District,
Exchange
has ruled that, for a
War Tax Symposium At
Social Research School
The New School for Social Re¬
search, 66 West 12th Street, New
York City, announces a 12 weeks
symposium on "Federal Taxation
in Wartime" in which outstanding
tax experts- will take part.
The
series of which Alex M. Hamburg,
Tax Counsel of New York City, is
Chairman, will begin on Sept. 28.
Among the major problems to be
war
and
are
Federal taxation in
the current tax
of 1943; tax legislation pro¬
peace;
after
days
bonds
ers,
on
are
no
the
period of 15
Third War Loan
delivered
subscrib¬
to
member firm
may
carry
margin Third War Loan bonds
for which it has subscribed unless
the customer (1) agrees to pay
the
debit
balance
within
bonds
months
or
less
a
off
such
against
period
of six
(2) does not
products
related
wholesale
at
Underwriting—There
Company
ers.
of
no underwrit¬
through certain
are
proposes
employees and through security deal¬
its
to
ers
and
Oregon
.
the
solicit
of
exercise
option
war¬
the company proposes to pay
expenses of such employees in connec¬
and
rants,
the
such
with
tion
sold
not
are
burse
If
solicitation.
company
all
will
such
reim¬
for
their out-ofIf all such shares are
will instead pay such
$1 for each share sold through the
dealers
security
povkft
expenses.
the company
warrants
of
dealer.
procured
by
such
.
,
Offering—Company has granted to hold¬
of its preferred stock, rights to sub¬
scribe for shares
of preferred stock now
get, John W. Hanes, former Under
Secretary of the Treasury, and
other
tax
2Va
each
shares
held.
Attractive
Situation ^
will
the
prepayment, so far as they suffice,
the company's notes outstanding in the
principal amount of $1,050,000.
Registration Statement No. 2-5166. Form
S-l.
(6-29-43).
July 20 fixing offering
holders at $40 per share,
unsubscribed portion to public at $40 per
to
share
stock
or
more
as
may
be
Products,which
attractive
situation
offers
at
markets."
new
Pittsburgh Rys.
Looks Good
The
<
situation
current
in Pitts¬
burgh Railways System, particu¬
larly certain of the underlying
bonds, offers attractive possibili¬
ties for appreciation according to
a study prepared by T. J. Feibleman & Company, 41 Broad Street,
New York City.
Copies of this
interesting study, which is avail¬
able to dealers only, may be had
upon request from T. J. Feibleman
& Co.
Robt Huff Visits NYC
H.
Co.
of
California,
Los Angeles,
several
spending
is
and
fixed
by
Machine
and
Co.
Haloid
Co.,
Dictaphone
offer
Strom-
Corp.,
attractive
Geyer & Hecht, Inc., 67 Wall St.,
New York.
Stafford Shields Admits
Stafford,
39
Shields
Broadway,
bers of the
change
Stafford
firm
on
New
& Robinson,*
York, mem¬
New York Stock ;Ex-
admit Margaret V.
partnership v in the
Oct. 1.
;
Y* j •
will
to
Available lor the Duration
according to memo¬
randa prepared by Herzog & Co.,
170
Broadway, New York City.
Copies of these interesting memo¬
situations,
may
directors.
...inModeration!
be obtained upon re¬
quest from Herzog & Co.
»»#««
board
whose
shares
at
were
$40 per
sold
registered
23,823
subscribed for by stockholders
share leaving 2,177 shares to be
publicly
ATLANTA
US.
York.
operations
C. H. Christ In Kenmore
.
at
$42
SCHENLEY
79 Wardman Road.
share.
per
(Special to The Financial Chronicle)
KENMORE, N. Y.—C. Herman
Christ is now conducting an in¬
vestment business from offices at
ROYAL RESERVE
be¬
GAS LIGHT CO.
subsidiary of
Consolidated Electric & Gas Co., filed a
registration statement with the SEC, for
$7,500,000 of first mortgage bonds, series
due 1963, and 20,000 shares of 5% cumu¬
lative preferred
stock, par value $100 a
share, on which sealed bids will be asked.
Address—243 Peachtree St., Atlanta, Ga.
Gas
Light
Co.,
a
Business—Company is an operating util¬
ity
company
business
of
engaged
purchasing,
primarily
in
distributing
the
and
Wall St. Cashiers Outing
The Cashiers Association of
Street,
Inc.,
announces
annual outing will
Wall
that
its
be held on Sat¬
urday, Sept. 25, at the Montclair
Athletic
Club,
Montclair, New
The outing was scheduled
originally for Sept. 11.
Jersey.
BLENDED WHISKEY
from fruit and
can
reached at the office of Huff,
be
Attractive Situations
berg-Carlson,
of
President
Huff,
&
weeks in New York City
an
current
experts are among the
Gisholt
randa
filed
Amendment
price
Mexico, Brazil and other
is
creating
a
higher
standard
of
living," Mr. Black
added.
"This, of course, makes
H"
expiration
pany proposes
of
of
countries
each lecture.
filed
be
tion
California,
Buckley Brothers, 1529 Walnut
craft
war.
Subscription
by amendment.
After
of the warrants the com¬
to sell such of the shares of
preferred
as
are
not subscribed through
the exercise of warrants, to the public at
such price as may be fixed by the board
Proceeds—Net proceeds will be applied
price
the
the
210 West Seventh St.,
levels, the firm believes. Copies
speakers. Leo C. Cherne, Secre¬
of this memorandum may be had
tary of the Reseaerch Institute of
America, will lead the series on from Buckley Brothers on request.
Sept. 28 with a talk on corporate
profits and the excess profits tax.
A general discussion will follow
being registered at the rate of one share
for
after
"A trend towards industrializa¬
Butler-Huff
posals; correlation of income, es¬ St., Philadelphia,:Pa., members of
tate and gift taxes.
the New York and Philadelphia
Randolph Paul, General Coun¬ Stock Exchanges, have prepared
sel of the Treasury Department,
an
interesting memorandum on
Gerhard
Colm,
principal fiscal
analyst, U. S. Bureau of the Bud¬ the common stock of Liberty Air¬
California.
ances
Robert
milk,
and
been built and which
been
expanded Con¬
siderably, will offer new profit¬
able markets for electrical appli¬
contemplate selling the security
prior to making such full pay¬
ment."
act
various
countries (>'and
military
and
general
business
of buying and
selling
butter,
cottage
cheese,
eggs
and
many
have
thus
a
in
week)
Riding'
The New York Stock Exchange
of
of
islands where naval and
bases have
War Bond 'Free
cancellation.
Registration Statement No. 2-5172. Form
fication
NYSE Acts To Cssrb
the company
dealt with
buying and selling of ice
of milk, and the
processing
The
bowling
Security Traders
deter¬
engaged in air trans¬
between the United States
conducts
becom«
Registration Statement No. 2-5203. Form
July 18, 1943.
Of
the 26,000
shares
now
and
shares
these
to
Registration
statement
effective
4:45
July 26, 1943, as of 5:30 p.m.
AIRLINES, INC.
American Export Airlines, Inc., has filed
a
registration statement for 43,888 shares
of capital stock, par value $3 per share.
Broadway,
airlines
p.m. EWT on
EXPORT
Address—25
proceeds
the
void.
Atlanta
AMERICAN
company
gross
to
EWT
Issues
were
but
ago,
not
<nknnwD
ar«
cf
statements
13,000 shares
of
preferred
:vv
STANYBowli'.ig Season Atiteiv Tourists Satisfy
Opens September 30
Buying Urge In lexico
.
OFFERING
below
the
$1,000,000,
The steamship company through
the sinking fund provision is retiring 2,100
shares of the preferred stock so that war¬
UNDETERMINED
,
We
whose registration
airlines
the
advanced
and
sale,
company.
of
DATES
redemption
.
company
warrants
the
to
the
common
of one-fifth
ratio
the
to
ers
stock, par value $10 per share.
Address—119
and each share
be paid for by cancelling
by the air¬
the steamship company.
sold privately in
shares of its preferred stock
company
steamship
1940
all
acquire,
may
lines
with
company
preferred stock of the steamship
it
exercise
•
■
Co.
and
steamship
the indebtedness owed
dealers
CO.
Lorlllard
debentures
ettes,
the
to
of
company
for
of preferred is to
sold
P.
steamship company are en¬
5 5/9 shares at the price
share
per
shares
■
Registration Statement No. 2-5214. Form
8-1.(9-15^43).
of
receive
retail in the States of Washington,
Underwriting—J. G. White & Co., Inc.,
for thepreferred stock.
Offering—The common stock shares will
be sold only to the holders of the com¬
pany's outstanding bearer warrants which
entitle them to purchase at $12.50 a share
on
or
before Sept. 1, 1944, an
aggregate
P.
shares
the
to
each share of the
steamship company preferred'stock.
Purpose—-Upon the exercise of any war¬
rants the airlines company is required to
lamps,
fur
attached
business—The
redeem
To
transfer
warrants
At the
prospectus holders of preferred
the
of
titled
vaults.
Proceeds—
the
of
company
stock
the
date of
the more important being
boys'
blankets,
ser¬
the
by
payment of the purchase price.
primarily in women's wear and accessories,
but
The
company.
exercisable
airlines
pre¬
American Export
steamship
a
are
preferred
of
filed
Inc.,
preferred stock,
f
:
cumulative
5%
of
shares
7,900
ferred stock of its parent,
attached
JULIUS GARFINCKEL & CO., INC.
Navy.
attached
the airlines company
of
warrants
The
S-l. (9-15-43).
Julius
of
exercise
$100 of
ment- later.
South
underwriters.
shares are issuable upon
capital
stock
purchase
Offering—The
stock
in
sale
Exchange
The
—
the
with
mili¬
Underwriting—No
the
in
:
Business
and
One
—
Company
:
-
City. N. J.
Holding
Utility
1935.
Caribbean, and
contract
under
America
of its common stock without par
the
in
bases
certain
States and
United
the
tween
tary
the
to
cumulative
share.
ster
MONDAY, OCT. 4
of
and
Cal.
dates, unless otherwise specified, are as of 4:30
P.M. Eastern War Time as per rule 930 (b).
These
•
bonds,
mortgage
at 104, and $2,150,-
principal amount of general mortgage
bonds, 3Va'/o., series due 1961, at 104'/8,
a
tion statements will in normal
general
1955, 4l/2 %,
000
6%
Following is
plant
1219
neutral spirits distilled
Distillers Corp., N.Y. C.
86 proof. 60%
grains. Schenley
THE COMMERCIAL & FINANCIAL CHRONICLE
1220
IIAnovcr 2-0050
Teletype—N. Y. 1-971
Firm Trading
Markets
w
■
For Dealers
If
interested
in
Chicago, Milw. & St. Paul
Missouri Pacific
Harvill
,
Corporation
.
.
Chicago & North Western
Old
Common Stock
1
rABL marks 4 r.o- '"g-
,
'■
'
^
■:
SPECIALISTS
get in touch
50 Broad Street
;.-V"
^v
e
<,0-'
with
for
us
>"* 5VV-;?;•.*Yv-.'-i
&
Preferred
M.S.WIEN&C0.
•/•.Yv""'Y'•'!'",;hv'«
:
Trading Market and Current Information
New York 4, N. Y.
.V"
Common
{with post-war prospects)'
FOREIGN SECURITIES
"
Pacific
Chicago, Rock Island & Pacific
FOREIGN SECURITIES
'
Western
•
...
,
,
all issues
Thursday, September 23, 1943
Members N.
25 Broad
Y. Security Dealers Ass'n
HAnover 2-8780
St., N.Y.
Teletype
Y.
N.
1-1397
Kobbe, Gearhart & Company
"Our Reporter On Governments"
Members
York
New
Dealers
Security
Association
Electrol
'
By S. F.TORTER
Of course,
NASSAU
4 5
the market is dull and apparently lifeless.
Nat¬
urally, some of the taxables are drifting to lower levels and there,
seems to be pressure on the
intermediate groups.
Obviously,
the big news in the Government mart today is the continuing war
'.loan drive and equally as obviously, every trend and everything that
happens may be traced directly to the influence of that campaign..
What is news, really, is the way the market is holding up in the
.
.
.
R Ector
1-576
york
new
Tybor Stores
Teletype
Bell
6015
Enterprise
2-3600
YORK/5
telephone
philadelphia
TELEPHONE
NEW
STREET,
Reiter Foster
...
What you should be watching is
the progress of the subscription figures; (2) the way the longterm tax-exempts act during this drive and (3) your own position in
relation to possible temporary switches.
*
Otherwise, what is
happening in the market now may be brushed off as the result of a
.
.
special development which will be
.
in another fortnight or so...
over
.
As for the progress of the drive, this observer still believes
the
statistics
of salt.
;
.
.
you're receiving
For the simple
.
"spotted" to give the
every
week..
be taken with
may
finance committees
war
And if the major sales
..
degree
some
that the big orders
reason
being
are
reported all at
were
ment's getting it from somewhere
few dollars?
my
.
.
.
else,
not, that's
or
once,
the 2%s is
Tel. WHitehall 4-7970 Tele. NY 1-2218
For
instance, at the end of the first week the total
000,000,
one-third the goal.
or
is around $11,000,000,000,
middle of next week
v
objective and
•
or
two.
exempts
than two-thirds.
to the
way
oversubscription
of
;
.
held
in
New
York
con-
last
the $15,000,000,000 plus, maybe a billion
was
possibly three is the maximum to be looked for.
or
That
would
be
wonderful,
though!
Treasury and wonderful for the market.
.
.
,
or
two
for
.
As for the
.
A tonic to all outstand¬
...
.
effect of
.
.
a
an offering and can't back out now and also
that he
prefer to postpone the fourth War Loan drive rather than
cash
It may
.
>
one
for six
a
which
while.
would
eight months,
commercial
stimulate
says
banks
dealer.
to
enter
the
.
.
open
.
outstanding taxables into
bond is the
one
"Consolidated Dearborn Com.
.
.
.
bonds of
12/15/53/49,
now
of
the
a
And you are
bonds of
are
selling at
.
price to yield 1.14% and the new
better yield for a while.
''■vw-//■.:
getting out of a high-premium bond and into a bond
an
unexpected slump.
you
considerable
protection
in
are
Great Lakes S. S. Common
And the
.
.
even
commercial banks,
•Circular
discouraging.
.
.
.
.
.
Member
But
.
.
*
.
.
Whitehall
marvelous bonds to
slightly better after-taxes yield
instance, there's the SEC report of
liquid savings in the second quarter of
000,000, the
same
hold, the
and
closer-to-par bond
a
osives
Ilarrisburir,
Miami
1-2178
j
Pittsburgh
Beach
few days
a
1943
indicating
ago
remained
at
R. J. Foster How Is
$9,100,-
In the three months
.
.
With Chas. Scranlon
cov¬
,......
Canadian Securities
,1196
Quoted
this
consumer
debt.
/•:
...
Our
despite tax payments!
But
...
THE
Reporter's Report........
MARKET
Reporter
Public
on
by the
Forced savings?
SEC, according to
Railroad Securities
HAY, FALES & CO.
Exchange
is being made is
■/;/:
Taxable
Who knows.
Broadway N.Y. BOwling Green 9-7027
Tflatype 2TST 1-61
Estate
Securities
.
.
money
is there, all
.
one
.
slip
may
.
off
good showing
a
authoritative report.
.
.
.
less of
more
a
drive
new
loan.
.
.
So
.
.
will
centers
war
•
.
•
•
of the New York Stock
Mr.
Foster
was
Exchange.
formerly
with
City, and prior thereto was man¬
ager of the bond department for
Shields
&
Co.
Foster
and
Co., Inc.
Sc
•,
ones.
.
.
due to
help maintain
jfSpecial to The Financial Chronicle)
fact
that
ANGELES,
V
CALIF.—Ru¬
.
shift of funds away from
big in¬
drives,
Dean Wilier & Co.
LOS
new
selling is
decentralized this time and somewhat greater individual
scriptions in
&
Rupert Bauer Joins
during this
more
they sell outstanding bonds, buy bigger block of
vesting centers than in former
associ¬
Scranton
Or just curiously
.
some
subscription to
on
W.
Dick & Merle-Smith in New York
due to sales by individuals, small firms and corporations
wishing
to make
Chas.
But the fact that the
survey
.
.
with
become
sub¬
customary fund dis¬
'
pert F. Bauer has become associ¬
ated with Dean Witter & Co., 634
South
was
Spring Street.
Mr. Bauer
previously with the California
Bank
as
manager
of the trading
department.
To Banks, Bankers and Institutional Investors:
Empire Sheet &
We have prepared
v
"TREND OF DEPOSITS OF
RESERVE
SYSTEM
ON
THE
SINCE
THIRTY
table
31,
1941—WITH
MEMBER
interpretive
Tin Plate Co.
BANKS OF THE FEDERAL
DECEMBER
SELECTED
together with
a
MEMBER
DATA
1st
BANKS"
comments.
Mortgage 6s
Common
1220
on
Written
Stock
Request
Memorandum
on
Request
1195
M. A. SCHAPIRO & CO.
WALL
1194
STATES
GOVERNMENT
SECURITIES
Tomorrow's Markets—Walter Whyte
1194
STREET
New York 5, N. Y.
Hill, Thompson & Co., Inc.
Markets
UNITED
Securities Salesman's Corner........1216
Says
CONN.—Rufus
HAVEN,
1194
1193
—
.
highly significant.
bonds
ONE
Real
They
.
Or freezing of savings accounts?
for the next drive?
1216
Governments
Utility Securities.
.
,
Now Available
Our
.
haven't tapped it yet.
we
Savings deposits of individuals in various regions of the U. S. being
1196
Municipal News and Notes
NEW
Co., 209 Church Street, members
$200,000,000 of
.1195
Trusts
(Special to The Financial Chronicle)
.
ated
Page
Bank and Insurance Stocks,,
Investment
Members New York Stock
NY
James Foster has
tribution.
Calendar of New Security Flotations. 1219
—
Tete.
& Co.
Exchange
Stock
3-0550
Syracuse,
in the first quarter and comparing with total
as
liquid savings in 1942 of $29,400,000,000.,
INDEX
Triumph
Sold
Philadelphia
New York
not respond¬
are
request
on
'
•
.
available
Blair F.Claybaogh
discouraging is the fact that individuals have the
more
ing to the 100% limit.
For
Rochester Transit Common
the memory
in October, will
have the ready cash to go in and just simply
money,
cor¬
the back¬
are
every other in
are
Oneida Ltd., Com. & Pfd.
lagging, if the New
Insurance companies and
.
they have been of
as
Belief is there'll be
...
are
Here's another:
Ball
.
.
a
though the tax-exempts
——
.
Surely, the inflation implications here
analyzed
question of the yield-after-taxes is of sufficient
importance to justify
switch by certain sources from the
exempts into the taxables in order
Bought
experts.%
what'tf
selling at 107.2
or
selling close to par, which affords
Even
criterion.
any
log of this campaign
INSIDE
...
the event of
are
porations, reached by experienced financial salesmen,
right.
2s of 1953/51 or into the
outstanding 2s of 1952/50.
You get a better yield after taxes on these
2s, for the outstand¬
2s will return
But individual subscriptions
....
results
an
new
ing 2s of 1952/50
71
.
and
.
9/15/52/50, now selling at 107.19
yield the equivalent of 1.12% after corporate taxes,
Then you may be aided by a switch from these securities
into
a
.
equity in life insurance, and paid off $50,000,000 of mortgage debt
offering after
one
.
?
the longest.
Valley Ry
4 Ms-41
200,000,000 to their Government bond holdings, $800,000,000 to their
SWITCHES
If you own the 2 Vz %
the
over, yes.
And
the
following the tax exempts.
If you own the 2%%
v
attractive exempt
most
...
yield 1.10% after taxes
to
to
compel the
after
POSSIBLE
to
The
,
.
.
.
ered, individuals added $2,900,000,000 to their cash and deposits, $4,-
.
be that there won't be another bank
would
And
advance
.
.
.
now.
October
market
.
instance.
"Utica & Mohawk
And because
give safety is upside down
theory that short-terms
.
ised the banks
take less
Which
...
supply the cash needed to round out Morgenthau's cash hoard.
heavy oversubscription on the bank loan
to follow this campaign, informed sources believe the
offering will
total $3,000,000,000 to $4,000,000,000,
regardless of the excellence ol
the public response.
Reasons being Secretary Morgenthau prom¬
this
can comfortably manage.
For the
exemption will become more valuable as
you
the
CASH IS THERE!
York
the
...
Wonderful
.
.
ing issues for the time being—and peculiarly enough, particularly
to the tax-exempts.
y
V
would
get out of those and into the longer-term
exempts are called and paid off.
more
WAR BONDS
*Ff. Dodge, Des Moines &
Southern Ry.4/91 and Common
need tax-exemption and own
you
A3s'n
New York 5
...
And that
.
as
that
If
...
Security Dealers
.
! Most detailed reports to date indicate the public is not coming
through to the extent hoped.
Drive is going over and will go
week, incidentally, was that $20,000,000,000 might be obtained by a terrific last-spurt campaign.
That seems a bit on the high side and this observer continues to
stick to the prediction made here weeks before the
campaign opened.
.
this
.
;
...
.
■
rapidly
as
traditional
THE
billion
a
true as ever.
as
reason
and
.
Y.
Street,
BUY
the
By
...
1
.
N.
Pine
30
the best switch this department has recommended in
which you'll be able to hold
should be in sight of the $15,000,009,000
we
our
on
in
$5,000,-
Gossip at the American Bankers Association's 69th annual
vention
'
holds
obvious
,
.
-
...
short-term tax-exempts,
As of this writing, the total
...
more
or
was
.
1955.
L. D. SHERMAN & CO.
...
the 27/gs is superior by 13 basis points. . . . The cost
is up, admittedly, but if your cash position can stand it, you may
find it advisable to freeze your profit in the 2%s and pick up the
the
gradual upward trend.
exempt bonds and
are
The yield on
that the announcements will
a
.
.
.
Members
more
in
Great Amer. Industries
bonds of 3/15/60/55, selling at 112.14
as such, we may anticipate that
the maturity date.
Which means
that the "real" maturity of the 2y4S is 1954 and the "real" maturity of
bility the committees cannot be overlooking and thus the belief
run
Copper Canyon Mining
may
you
the call date is equivalent to
years
possi¬
a
bonds of 6/15/56/54, selling at 107.8 to
taxes,
1.39% after taxes.
These
Of course,
why should I bother
so
Whether true
after
into the 2%%
27/8S for yield and a possible advance in the coming months.
there might be a tendency among individuals to say "the Govern¬
lending
to yield
ammunition
some
1.26%
Switch
.
.
(1)
2^4%
If you own the
yield
.
.
face of the subscription total.
Southwestern P. S.
BANK
and Situations
for Dealers
STOCKS
INSURANCE STOCKS
120
Broadway, New York 5
Tel. REctor 2-2020
Tele. NY 1-2660
@FedFRASER