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UNIVERSITY
OF MICHIGAN
Chemical
Industry Featured In This Issue
176
New
Number 5154
EDITORIAL
Price 40 Cents
York, N. Y., Thursday, September 25, 1952
Chemistry's Vital Role in
Economic Outlook Developing Nuclear Power
We See It
long time Administration spokesmen in¬
in and day out that the long series of
wage increases being granted had no important
economic significance—or, at all events, had no
untoward economic significance. Again, and again
and again, to use a phrase so dear to the heart of
the late President Roosevelt, it was asserted that
a
such advances in the pay of workers,
in the cost of production, laid no basis
By EUGENE M. ZUCKERT*
By SUMNER H. SLICHTER*
sisted day
Member, U. S. Atomic Energy Commission
University
Lamont University Professor, Harvard
Speaking to chemists and chemical engineers, Mr. Zuckert
developing and controlling nu¬
Professor Slichter, in viewing
possible developments in
the months ahead, sees defense spending reaching peak
by middle of 1953, while, at same time, total demand for
goods will be slowly increasing. Forecasts little up or
reveals role of chemists in
clear power.
use
because of
a
plateau of defense spending, but looks for
likelihood of
atomic power
contraction
a
the next six
Within
nine
or
months the peak
problems of admitting atomic power production to private j
operation. Holds foremost question is how to tie in use:
of atomic power for both civilian and defense purposes.*
rate of
the opportunity to speak at your Atomic
This Seventh National Chemical Exposition
is indeed inspiring and is a tribute to the ability and in¬
I
defense spending (including foreign aid) is expected to
be reached. It will approximate $60 billion a year, or
come
now
perhaps
when it is merely
a
■
silly to assert that the repeated "breach of the
line" in wage cases can fail to have wide rever¬
berations throughout the business world: * It is
still being argued in some unrealistic quarters
that the steel settlement set no new "pattern" of
tinued
and
of the slide-off.
«\
the
are
and potential
half
three principal
•*An address
and
of
(
will
it.
Dec.
be
The anniversary
2—only
10 years
the calendar measures time,
eons
away in
terms of atomic
away as
but
progress.
1952.
?
physics govern the operation of chain
and nuclear weapons, it sometimes seems that
Because laws of
reasons
reactors
Continued
One is that no improve-
by Prof. SHchter before the National
on
page
M. Zuckert
Eugene
26
on
32
page
Zuckert at the Chicago Section of the Ameri¬
can
Chemical Society on the occasion of their Atomic Energy Day,
Chicago, 111., Sept. 11, 1952.
*An address by Mr.
Hardwood Lum¬
— Underwriters,
dealers and investors in cor¬
complete picture of issues now registered with the SEC
REGISTRATION
IN
NOW
.
controlled
date
Association, Boston, Mass., Sept. 24, 1952.
ber
porate securities are afforded a
DEALERS
and not
is
Continued
38
SECURITIES
year
roughly the average
defense spending during the
$45 billion or $50 billion a year.
merely permitting the miners to
page
\. • t v
; '• .
■
fitting that this-milestone of 'f
and engineering, commem-'
orated in Chicago, should feature the
progress and uses of atomic energy.
It is a little startling; perhaps, to
realize,that only 10 years ago, in this,
very city,, man first, initiated a selfsustaining nuclear chain reaction,
for expecting that
the level of defense expenditures will not drop below
There
certainly not be
on
a
»:'•'(•»'«-
v
It is
science
It is likely to be not
$5 billion
This
rate of
H. Slichter
first
Continued
life."
$10 billion a year. After
slide-off has occurred, defense
year.
triumph of Mr. Lewis in the case of
as
Late in 1954
expenditures will remain indefinitely
at about $45 billion to $50 billion a
increases.
regarded
1954.
than
more
/
,
Prof. S.
of the steel industry, can
than
less
coal, made much easier obviously by the experi¬
ence
1954—certainly
in
that
But the
of
Congressional- elec¬
early in 1955 a gradual slide-off
defense expenditures will prob¬
ably begin. It is impossible at the
present time to say anything very
definite about thfe rate and the size
:;: 3^
prior increases had/already
"breached" the wage line and set a "pattern" of
wage
the
1953;
or
worth much argument, since the defense of this
settlement seems to come down at bottom to an
assertion
after
tions in November,
'
dcrnot think the issue is
We
throughout the rest of
perhaps;all
until
granted the men
merely;permitted
employees to "catch up" with those in
industries.
genuity of American chemists and chemical engineers.
The growth of the American Chem- <
; •
ical Society over the years js sym¬
bolic of the spread; and growth of
chemistry's contribution to modern I
rate of defense spending will be con¬
>
wage increases, since what was
in that instance, so it is alleged,
steel mill
The present outlook is that this
little less.
;
welcome
Energy Day.
.
But the time has
purposes. Forecasts likelihood of
plantsj within next decade, and discusses j
for other
nuclear power
coming months.
.
Commission still lies in creating atomic
is being made in speeding use of
weapons, says progress
thereafter, when defense,
spending slides off. Expects only slight rise in prices in
some
They are even yet not ready apparently
to cease harping on the Capehart Amendment as
something very nearly indecent in recent legis¬
lative history, although, of course, the Adminis¬
tration has had to yield a good deal more, at least,
in the steel case, than that Amendment made
mandatory.
:
;
"iv ■
Describes recent developments leading to its
Though stressing main activity of
in civilian life.
Atomic Energy
down movement in business conditions within next year,
and hence
for higher
prices.
other
Copy
a
The Short-Term
As
For
6 1952
OCT
Pat. Office
Reg. U. S
Volume
Z
undertakings in our "Securities in Registration"
Section, starting on page 42.
State and
•
j
V
•
in
Municipal
U. S. Government,
Stale and
Municipal
Securities
Pacific Coast &
Bonds
Hawaiian Securities
'
•
telephone:
/
HAnover 2-3700
Direct Private
Wires
Bond Department
Chemical
BANK & TRUST
COMPANY
DeanWitter
&
Co.
THE NATIONAL CITY BANK
Street, New York, N. Y.
14 Wall
Members of
and
OF NEW YORK
Principal Commodity
\BONI
Los Angeles
•
•
Chicago
Bond
Dept. Teletype: NY 1-708
Honolulu
NATIONAL BANK
of INDIA. LIMITED
Public Service
Bankers
on
to
the
Government in
Office:
26,
Bishopsgate,
Banff
London, E. C. 2
Request
Branches
in
Pakistan,
India,
Hardy & Co.
Members
Members
New
York
Neio
Stock
Exchange
York Curb Exchange
Authorised Capital
Paid-up
Reserve
Tel. DIgby 4-7800
New York 4
Tele. NY 1-733
Capital
Fund
„
...
£4,562,500
£2,281,250
and exchange
'
J
j
THE CHASE
NATIONAL BANK
OF THE CITY OF
NEW YORK
Cities
BONDS & STOCKS
Puget Sound
Power & Light
Co.
Analysis upon request
Oils, Ltd.
,
CANADIAN
DEPARTMENT
ESTABLISHED 1891
of
MEMBERS NEW YORK
STOCK EXCH.
business.
Trusteeships and Executorships
also undertaken
and 10 other Western
™
CANADIAN
Goodbody a Co.
£3,675,000
The Bank conducts every description
banking
30 Broad St.
Protectorate.
Denver
Spokane
4U
—,
»
Bought—Sold—Quoted
Kenya, Tanganyika,
Zanzibar, and Somali-
land
YORK CITY
Ceylon,
Burma, Aden,
Uganda,
Husky Oil
Ltd.
& Refining)
Sherritt Gordon Mines, Ltd.
Kenya Colony and Uganda
Head
Circular
ESTABLISHED 1915
Members of All Principal Exchanges
50 BROADWAY • NEW
Los Angeles
Saa Franelsee •
Boston
General
j. A. H0GLE & CO.
,
Salt Lake City
Security Exchanges
bond department
nm
30 BROAD ST., N. Y.
1
.
115 BROADWAY
NEW YORK
1 NORTH LA
Pomcoox Securities
Grporation
40 Exchange Place,
SALLE ST.
CHICAGO
Teletype NY 1-702-3
New York d.N.Y.
WHitehall 4-8161
ira haupt &
co.
Members New York Stock Exchange
and other Principal Exchanges
111 Broadway,
WOrth 4-6000
Boston
N. Y. 6
Teletype NY 1-2708
Telephone:
Enterprise
1820
■;
2
>
k
The Commercial and Financial Chronicle
(1110)
...
Thursday, September 25,
\ t'
The
WE POSITION and
TRADE
Security I Like Best
IN
This
Forum
A continuous forum in which, each week, a different
group of experts
in the investment and advisory field from all sections of the
country
American Maize Products
Polaroid Corporation
participate and give their
for favoring
reasons
Their
Louisiana Securiti
(The articles contained in this forum
they
are
Pacific Power &
Light
be regarded,
to
HORACE
Paget Sound Power & Light
L
as an
Machinery Co.
concern
Manager Trading Department,
& King, Libaire, Stout & Co.,
New York City
Eastern Utilities Assoc.
about
to
Members, New York Stock Exchange
tion
Conv.
&
Common
General
& Common
Central Public Utility
the
me
(Indiana)
their
of
Fiduciary
Inc.
nt,
1500%
after
Established
Y. Curb Exchange
Associate Member N.
120 Broadway, New York 5
Teletype NY 1-583
BArclay 7-5660
by
for
purchase
Donald
of
almost
nine
L.
profit
no
but the
very
small,
years
was
In
1946
negotiations
con¬
were
ducted with Aviation Corporation
the
the
and
Dec.
Crosley
Corporation
by
poration—and
these two corporations was nego¬
tiated which provided that Avia¬
duripg
achieve
allow
Since 1917
(2)
McpONNELL&fO.
Members
120
Exchange
Curb
Exchange
Tel.
REctor
5
YORK
NEW
BROADWAY,
2-7815
Spe¬
reorganiza¬
liquidation and two
situations;
a
advances
Stock
gain? First
that general mar¬
to say
me
tion,
York
1500%
small portion of the gain.
cial
York
to
the
ket investments accounted for but
a
New
Horace I. Poole
were
(1)
a
the
to
Corporation
would
accept
shares of stock of Crosley Motors
in
exchange for certain assets
What
employed
New
tion
coming
contract between
a
working capital
of small companies have produced
which would become the property
of Crosley Motors. At the begin¬
ning of these negotiations, Fidu¬
ciary Management, Inc. purchased
stock
in
Crosley
Corporation
which it later sold at
of
a
gross
Fiduciary Manage¬
later bought stock of
Inc.
ment.
during
17-month period.
a
At the
beginning of 1952, Resort Airlines
common
was
selling at 30c per
share.
had
Thus
$555,386 investment
a
increased
to
at
$1,666,159 when
market
Direct
of Nationwide
personnel
Resort
Airlines'
change
for
Fiduciary
stock.
to
shares
104,412
in
HOFFMAN RADIO
Circular
exchange
on
request
of
is
subject
Securities
148 State St.. Boston 9, Mass.
Tel. CA 7-0425
N.
Y.
:
Teletype BS 259
Telephone
WOrtn
4-5000
Fiduciary's ownership of
r
84% of the capital stock of Resort
Airlines and raise the total out¬
standing
Standard Oil of Indiana
of Fiduciary to
common
Rgts. & Conv. 3 % %—1932
558,907 shares.
Long Island Lighting
Resort Airlines, Inc. is now em¬
barked
branch offices.
our
ex¬
Exchange Commission. It will
and
to
common
approval of the
result in
wires
Air
shares
Management
This
the
NY 1-1557
J
On Jan. 15, 1951, Resort Air¬
lines, Inc. acquired all the assets
and
Excha~\,<i
quotations.
on
extensive
an
Common
advertis¬
ing campaign to promote its all-
the Crosley Motors from Aviation expense cruises to the Caribbean
and is said to be booked through
gain recorded by Corporation. On these transac¬
the
summer
of
1952.
The
alltions total realized profits were in
Fiduciary Management, Inc.
expense cruises of Resort Airlines
Operations began early in 1944. excess of $300,000.
have created a good deal of in¬
A number of subsequent trans¬
The company was formed at the
terest as they are $239 for a onerequest of certain clients of Fidu¬ actions did not turn out well. A
week cruise which takes the va¬
ciary Counsel, Inc. This latter small property purchased in Oak¬
cationer to three foreign ports. At
concern
provides investment ad¬ land, Cal., and three other small
vice to wealthy individuals./ Its transactions resulted irt little profit present Haiti, Nassau and Havana
For almost/two years— are on the one-week flight and
accounts are limited to appfoxi* or loss.
Jamaica and Guatemala on the
operations of Fidu¬
mately
100
and
the minimum 1948-1949
two-week tour.
amount accepted is $500,000. Ap¬ ciary Management, Inc. were prac¬
The acquisition
proximately $500,000,000 of funds tically at a standstill. The com¬
| of Nationwide
Air Transport, Inc. brought into
are thus supervised!
pany retired its preferred stock
and made an offer to purchase its
In Fiduciary Management, Inc.
Resc(rt Airlines an experienced
the founders sought to create a common stock at $2.35 per share
personnel which further rounds
of
much
Curb
HAnover 2-0700
profit
$145,656.
York
St., New York 4, N. Y.
NewOrleans, La.-Birmingham,
Mobile, Ala.
of
achievement
methods
Members New York Stock Exchar.f/e
Members New
Sr., Vice-Presi¬ Transport Service for 2,000,000
shares oj. Resort stock. On June 2,
Fiduciary Management,
Fiduciary negotiated
the
Inc.—looking toward the sale of 1952,
certain assets
to
Aviation Cor¬ acquisition of 1,953,000 of these
dent
hope that this
the
Steiner, Rouse &
Clinton Davidson,
there basis for
decade?
Bought—Sold—Quoted
25 Broad
computed
$t>3,000.
1944-Dec.
1952. Is
31,
31,
cated
Rights & Scrip
Investor's Sta¬
on
B.
&
Fiduciary Man¬
will be dupli¬
Specialists in
John
Shober, Partner
Shober, New Or¬
leans, La. (Page 29)
—
Woolfolk
Chairman
now
of
investment
in¬
period
1920
1945
amounting at the inception to but
-
Corporation
tus
transac¬
in
Murray Co. resulted in
in asset
value
Hartz,
Board
The
com¬
Manage-
enjoyed
crease
New York Hanseatic
the
of
stock
common
has
a
value
asset
stock.
mon
3%/82 W. I. & Rights
Selections Based
agement, Inc.
in
SYt/SZ & Common
Standard Oil
Raymond
1500%
gain since 1944!
Few
companies record such an increase
Telephone
Conv.
This
completed
was
Inc.—
to Blaw-Knox.
$448,000.
Fiduciary Management, Inc.
4.75%
Properties of this
sold
The realized net profit to Fidu¬
ciary Management, Inc. amounted
Eisele
Southern Production
were
Management,
Horace r! Poole, Manager Trad¬
ing Department, Eisele & King,
Libaire, Stout & Co., New York
City. (Page 2)
are not intended to
be, nor
offer to sell the securities discussed.)
POOLE
Alabama &
Selections
particular security.
a
Fiduciary
Iowa Southern Utilities
Week's
Participants and
&
Rights
Missouri Pacific R. R.
Old
the
Common
Foote Mineral
♦Prospectus
on
request
Gersten & Fbenkel
vtpm.ber*
150
Tel.
N
Y,
Security
Broadway
Dealers
Assn.
New York 7
DIgby 9-1550
Tel. NY 1-1932
—
Trading Interest In
American Furniture
Bassett Furniture Industries
Camp Manufacturing
Commonwealth Natural Gas
Dan River Mills
vehicle
Lynchburg, Va.
LY
7J
small
period
endeavor to
STRADER,TAYLOR & CO., fnc!
a
part of their funds in venture op¬
portunities. They felt that in an
secure
in
to
ital
TWX
investment
inflationary
Life Insurance Co. of Va.
LD 39
for
of
order
they should
growth in cap¬
offset
the
effect
declining purchasing power. It
their opinion that this objec¬
was
by pooling their funds with others,
a
VIRGINIA—WEST VIRGINIA
fund
large enough to be effec¬
tive could be raised and operated
without undue risk on the part
of
No fee
any.
kind
commission
or
of
paid for the raising
of the capital of Fiduciary Man¬
any
NORTH and SOUTH
CAROLINA
was
agement,
Inc,
The
common
RICHMOND, VIRGINIA
Bell System Teletype: RH 83 & 84
Telephone 3-9137
The original capital of the en¬
terprise consisted of 20,000 shares
of
$100
$4
par,,
preferred
non-cumulative
for
stock
the
which
received $100 per share.
shares of common stock
company
60,000
were
sold at $1
per
share.
In
June, 1945 the common stock of
Fiduciary Management, Inc. was
split 4-for-l. The company oper¬
Nuclear Instrument &
ated with the
plying
Chemical Corp.
At
a
that
preferred stock sup¬
leverage factor until 1949.
time
the
retired at 104.
Circular
on
Request
In
stock
common
preferred
was
1946 additional
was
offered
to
shareholders at $3 per share.
Republic Investment Company, Inc.
Investment
231
SOUTH
Securities
LASALLE
STREET
CHICAGO 4
Teletype
Direct
Wire
Mackie,
to
FRanklin 2-1160
Singer,
Inc.
New
Beane
York
of
Dec.
&
As
31, 1951, the outstanding
capitalization of the company con¬
sisted of 454,495 shares of com¬
stock
mon
in
One
of
the
early
the
per
ventures
Fiduciary Management,
purchase
stock
25c
:
of
the
of
all
Buffalo
Inc.
the
of
was
capital
Foundry &
WALL
by
even¬
President;
as
of
a
from
The
Fiduciary
has
today employs 80 pilots.
complete training
a
also
include
within
daily
the
through
secured
Indian
of
laborers
oped by him in cooperation with
Raymond Hartz and Clinton
der
Davidson,
;
SUGAR
Raw
—
Refined
—
Liquid
Air
Transport
Association of scheduled airlines.
Transportation
N. Y.
charters
States
the
5,
It
program
military
United
STREET
NEW YORK
for bringing through to this level
qualified
personnel.
Operations
value
asset
99
Resort Air¬
accompanied
was
British
is
Exports—Imports—Futures
Wes+
furnished
un¬
DIgby 4-2727
General Foods.
1952,
share.
As
Sr.
asset
of
March
was
value
$4.18
31,
Davidson, Jr. has
had
an
unusually broad back¬
ground of experience in prepara¬
tion
for
investment management!
In late 1950 Fiduciary Manage¬
ment
again used its capital and
advisory services and invested in
Airlines,
Inc.
This
pany
had
suffered
losses
from
the
com¬
poration
with
large
U.
S
On Feb. 1, 1952,
the corporation
invested $300,000 in Brown-Allen
Chemicals,
one-year
option
of,
Inc.
to
one
In
form
of
turn
?
an
share
Fiduciary Manage¬
borrowed $300,000,
•;
/
per
;
.
by
concern
5,553,866
stock.
This
was
shares
stock
represented
of
had
common
cost
Fidu¬
ciary Management, Inc. 10 cents
per share.
On Dec. 15, 1951, Re¬
sort Airlines, Inc. paid a dividend
of 2
cents
stock.
1 cent
1952.
a
per
was
paid
its
com¬
on
of
Jan. 15,
The
income
now
afforded
in-
return
a
on
of
Fiduciary's
Resort,
Airlines
JAMES M. T001AH & CO.
67 WALL STREET
NEW YORK 5, N. Y.
HAnover 2-9335
Teletype NY 1 -2630
Over-the-Counter
said to be at the rate of $1.-
200,000
fund
from
these
annually.
established
recently
was
A
in
wells
is
subsequent
March,
producing
19*1
at
the
rate of $400,000 per year.
A wise man once said that three
things
or
entered
failure,
men,
that
men.
approximately 30%
investment
on
A second dividend
share
This
share
STOCK-
,
-
this
COMMON
1950, Mr. Clinton Davidson i
aggregating approxi¬
which enabled them to secure tav
$600,000.
Operations : for
advantages and large profits in
1951 resulted in gross
oil operations without being sub¬
operating revenues of $4,335,752
ject to all the risks an inexperi¬
and
net
operating revenues of
enced
oil
investor
usually
in¬
$523,882. Net income after taxes,
curred. In 1950 a fund of $1,450,000
but including $590,472 profit on
was
provided largely by clients
the sale of aircraft, amounted to
and 36 wells have been drilled
$783,758. This was equal to 8%
28 are producing and 8 are drv
cents per share on 8,956.240 shares.
in
Sioux Oil Co.
Sr. prepared for clients a method;
year
By the end of 1951 the investment
Producing, Refining
Distributing Company
Inquiries Invited
mately
the
A
and
shares
30.000
stock at $3
41/2%.-
at
the
purchase
year.-
in
ment
in
5% note and received
common
for
operating
day of its incor¬
contract
growers such as Green Giant and
per
Clinton
mon
value
par
—
share.
Telephone
CG 2197—CG 1614
rise
organization.
lines
to
tually emerged
Resort
buy any preferred stock.
CRAIGIE&CO.
situation
out the
those stockholders
liquidate.- This
from
wished
management reorganization
which Clinton Davidson, Jr.
management
allowed to buy 20,000 shares
stock without having to
was
MUNICIPAL BONDS
■F. W.-
value),
who
equal to 90% of asset
was
tive could not be accomplished Management, Inc. common-stock
individually without, risking too, since has resulted largely from
great a portion of their funds and the policies and programs devel¬
without too great an expense; but
Since 1932 Specialists in
(which
LAMBORN & CO., Inc.
of
methods
the
Methods
the
money,
and
these
money
incidental,
on
Incorporated
Established 1913
wer"
and
46 Front Street
properly manned they meant
Continued
National Quotation Bureau
wa"
of
and
for 39 Years
success,
undertaking-
and
greatest
important, but
not
into
an
Quotation Services
page
29
CHICAGO
New York 4, N. Y.
SAN
FRANCISCO
Volume 176
Number 5154
..
The Commercial and Financial Chronicle
.
(1111)
Can You Really Afford
Not Taking Profits?
INDEX
Taking Profits?—Ralph A. Bing—
the restraint imposed by the Capital Gains
Tax against "taking profits" in stock market
operations,
Mr. Ring reveals a
variety of situations under which it may be
market.
Many
stocks
past
inadvisable
Gives table
investors
be
may
believe
close
to,
that
or
they
if any speculative excesses in
U.
S.
ji
the
a
make
it
with
How
their
stocks,
regardless
of
cyclical mar¬
e
v
would
like
tia 1
p
what
through
selling
operations,
t
■
and
it
were
i
f
and
switching
not
for
s
form
to
this
on
decline,
if
any,
be
can
other
ket
to
these
Mere
politics are,
since the an¬
questions
:
It
safe
seems
to
?
Administration will allow
to degenerate into an
no
recession
trend,
or
that
ex¬
-
huge defense re¬
quirements, savings, social insurance
schemes, and other factors
special
which
cir¬
pointing toward dif¬
action?
(3)/ How • .much
ferent
the
tax
in
be
and
to
main
down
go
seller to
"ahead
/'Obviously,
the
first
main
or
the
the
third
of
question
assumptions
?
realm
arithmetical
will
be
can
terms,
have
to
in
given
the
questions
Stock Market
growing
a
investors
about
business
outlook.
the
I
out in the "Chronicle"
1951, the likelihood
in
capital
outlays
decline
a
in
1953,
direct defense spending
well
may
start of
always barring
ternational
our
incidents
into
us
foreshadow
a
armament
stock
to
have
specialized in
t
Mutual
NSTA
Our
in
20%
increasing
annual
to
Btaton
-,p
to 25%
sections
the
on
*
"*>.
•■'/
*,
V.--"-i YSsSTYPE ji"
-ClfM iFsBi.Scketwrto Jy
.
•
Private Wire to
-
"
LOS ANGELES, CALIFORNIA'
'
44
——
Singer, Bean
& MACKIE, Inc.
46
*
_
Corner.—
39
31
Registration.—_;
HA 2-0270
42
_____
;
40
Exchange PL, N. Y. 5
Teletype NY 1-1825 & NY 1-1826
2
5
(Walter Whyte Says)
47
L.
48
Not Available This Week.
Established
Published Twice Weekly
-
FINANCIAL
,
1
B.
CHRONICLE
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Place,
London,
E.
.
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i\;
WILLIAM
York 7,
N. Y.
SEIBERT,
Y- 1^5
ary
25,
York,
as
1942,
N.
Worcester
,'
/
President
Thursday, Sept. 25, 1952
*,
r'
*
Every Thursday
pieie
itsoe^
statistical
Y.,
at
the
under
post
the
office
Act
of
recqrds,
state
and
every
Monday
issue— market
corporation
at
a,
'
Stock
Exchange
New-
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March
York
York
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Exchange
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York'
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Exchange,
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Exchange
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year.
*
(general news and ad-
and
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second-class matter Febru¬
1879.
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*•
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SEIBERT, .Editor & Publisher
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Eng¬
1856
Company
REctor 2-9570 to 9576
/■/
C.,
Copyright 1952 by WHliam B. Dana
Reentered
COMPANY. Publishers
New
Gardens,
and
Reg. U. S. Patent Office
,
Drapers'
land, c/o Edwards A Smith.
COMMERCIAL
The
-v
"
Southwest Natural Gas
8
,
CROWELL,WEEDON A COS"
Reeves Soundcraft
29
vertising
C
Sulphur
39
1.
NEW-YORKl...
.
•
5
—
:
Securities
Tomorrow's Markets
Pan American
10
___
Washington and You
•
public
page
DOFfl QTflPKQ
1111.11.11 HEU UlUullO
Exchange'-v
34
16
The State of Trade and Industry—.
if and when
of
Cinerama, Inc.
40
The Security I Like Best
that
Corp.
*
—
Governments
in
and Research
26
.—
Security Offerings.. _i
Now
Associated Development
8
—
1
Securities Salesman's
DDCCC
Chicago
*
5
._
___
Securities
Securities
be
-
#
on
Utility
Railroad
corporate
seem
assumption
Continued
Members New York .Stock
Albany
48
„:
j,
Reporter's Report
Public
the market, on the average, could
■
TELEPHONE HAnover 24360
23
^
Notes——-
Prospective
rather insig¬
a
It does not
unreasonable
an¬
ST.,
'—_i_Cover
/
Funds———
Our Reporter
only about 4.2% below
Spencer Trask & jGp.
25 BROAD
1
Observations—A. Wilfred May.—___—______
industrial
——
-
(Editorial).
News About Banks and Bankers
25
••
See It
^Indication of Current Busines Activity
Industrial
Stock Aver.
WILLIAM
.
37
Einzig—"Reasons for Recent Sterling Weakness"
1
For many years we
28
.From Washington Ahead of the News—Carlisle
Bargerson—_
50%
Dow-Jones
postwar peak,
decline
27
•
Dealer-Broker Investment Recommendations
25
an
of
—
tries
24
___,_
U. S. Aid, says Marcus Nadler__
Business Man's Bookself
averages:
25
earnings.
would
effort.
market
on
*
-r'
Bank and Insurance Stocks.
*
•The
,
vAs We
far, that is by mid-Septem¬
downtrend
in
in¬
new
that
f
-
National Central Mortgage
—
the
re-acceleration
-J
on
nificant reaction to the prevailing
business recession later
a
next year,
force
-
•'
a
,_1
—
23
Regular Features
29
its
by
private
business, together with a leveling
off
stock
44 %
average is
May 10,
on
of
22
,
/Where It Comes From (Boxed).,
reflected
as
41C Stock Aver.
the
Chicago
Shelby Cullem Davis Warns of Insurance Company Mergers— 35
Here is
24
ber,
pointed
^
•
<Los Angeles
'
idea
do
1946/47
long-term
As
might
1941/42
So
Direct Wires
Philadelphia
:
/Scores Unsoundness of Our Monetary
Policy—
three-
rough
a
picture,
1Q37/7S
of
concern
v
,
...
Europe Leaning Too Much
,
circumstances,
least
stocks
Stand. & Poor's
Dec'ine
made.
stock
reflect
Bank
*
Percent. Deolines
markets,
which has
been apparent since August, seems
to
says
Seek Wider Market for Pennsylvania
"Authority" Bonds
//Tp Study Possibility of Creating
«
6
1-3370
22
recessions
different reason
different
two
Teletype NY
16
.Coming Events in Investment Field—
overall
BO 9-5133
12
18
/Canadian Securities
The hesitant and easier tone in
the
Warranted,
trophe of the 1929 type.
the
Broadway, New York
22
v
could
the
61
8
„
market
a
at
what
once
been
of
-
Develops Hard Transparent Plastic Film
profits
-
J.F.Reilly&Co.
Incorperated
•
Chemical Industry
the downside under serious strain,
other
than ;an
economic ' catas¬
re¬
answer
each
for
give
to
as
estimates,
answering
two
and
one
they
re¬
any answer given to
questions
on
volume
and under different
game."
"guesstimates"; the
in
to
or
33
,
Max Winkler
large depreciation charges.-
occurred
permit the
even
of the
two
in
to
out.
come
effect
shrinking
previous stock
vidual case, and how much would
the stock, subsequent to a sale,
have
30
Gold From Sea Water—A Wild Goose Chase
should not under¬
one
Although
each -indi¬
-
29
'Low Profit Margin Endangering
Security Industry and
'
Investors—Herbert E. Harris—
__•.
•
have in the face of sticky wages
cumstances
would
hand,
the serious
-
Stoek Prices Lower Than
continued
rate
•
Sterling Oil
25
Index—Roger C. Heimer—_— 25
Better Public Relations Sought by
/
model, quite apart from the fact
prevailing down
there
are-
s. •
Incorporated
'
other
a
Oil
24
_„
State Tax Collections In 1952—V. J.
Wyckoff
//
extreme depression of the 1929-32
held, behave in the
they likely to fully
participate in
,
by Chemical Industry—
say
stocks,
Are
20
in
would stand in the way of a
deep
and protracted depression. On the
now
/
Right to Succeed and the Right to Fail!
F. Lee—
the Stock Market
on
Reeves Ely Pfd.
18
;
■
/•: Simple Automatic Investing—Homer Fahrner.
be
can
pected in the next six to t\yelve
months? (2) How will individual
market?
>. We Have the
l;V,—Laurence
on
factors;
decline.
that
to try to answer three basic
ques¬
tions: (1) How big a general mar¬
ket
Farley
Earning Assets for Savings Banks
as
,s'v—Alfred J. Casazza
„
has
one
Tax-Exempt Bonds
inter¬
on
Reeves Soundcraft
14
*
reasonable
a
The Election Prospects—James A.
.
a
an¬
14
—
advance, at best, in -^Wealth of the Sea---Roger W. Babson
terms of trends, and not in quan¬
I"- /
'
1
"
*
*
*
titative terms, it is of course im¬
i More on
"Regulation A" Offerings and Small Business
possible to forecast the exact ex¬ ; -'/"(Editorial)
tent of any
resulting stock mar¬ ; ; Marketing Process Stressed
a
problem;
would
repercussions
provided
the
probably market decline.
opinion
the
swer
resulting tax liability; they feel
they simply "cannot afford" tak¬
ing good profits because, they
think, the tax bite would prob¬
ably offset, or even outweigh, any
(- In order
severe
government
national trade and
paper
o
the
•
naturally
how
public
the
on
■
Pricing Chemicals Under Current OPS Policies
Elston E. Fogle
its policies regarding taxes,'
credit, public works, etc., how /I. We Have Government Management of Railroads
other countries are
affected, and rv;i —Not Regulation!—William White
of
r
This
on
■»
Cinerama Inc.
12
„_
,napes
their substanRalph A. Bing
the
velops, how
at
part
decline?
stocks,
10
Bank Supervision and the Bank
Capital Problem
—W. Harold Brenton—.
~
WALL STREET, NEW YORK
Telephone: WHitehall 4-6551
9
Socialized. Medicine and Its Failure in Britain'
,\j/T—Rt. Hon. Lord Horder
:
ticipate, how actual business de-,
r,
to
rotect
least
could
depend
recession
others
many
•
would
Stock Decline
a
much
average,
swings.
o w e
Far
99
6
,
Chemicals—A Symphony of Synthetics—Ira
U. Cobleigh
thesis
How
,
Wall
Obsolete Securities Dept.
An "Obstacle Course"
The Business Outlook—Marshall D.
Ketchum—_
of an oncoming re¬
majority of investors
would
undoubtedly have a de¬
pressing effect upon stocks.
"
to
part
H
—August Huber
the
acceptance
a
not
markets,
cession by a
Some of them
rule
stock
at
5
6
The Stock Market's Path:
to
WITH THE SUITE
99
—Hon. John W. Snyder
cycle, and
currently few,
your
THE BIDDER
4
Mexico's Booming Securities Industry—A.
Wilfred May
Prosperity Should Not Be Based on Defense Effort
.
business
are
4
Savings Banks' Hazards in Common Stock Investments
—Roger F. Murray-
declining
a
in
time.
some
the
although there
declining
phase
for
ket
stocks in
ticipate
even
peak, and that
broadly speaking, be
f
sell
to
Chemicals—Donald K. Ballman__
Take
obsoletes
3
Sales Development for New
guide in determining when to take profits.
as
their
may,
;
on
or
AND COMPANY
Cover
The Short-Term Economic Outlook—Sumner
H. Slichteiv_-Cover
Can You Really Afford Not
Head, Analytical Department, Sutro & Co., San
Francisco,
Members, New York Stock Exchange
either advisable
Page
Chemistry's Vital Role in Developing Nuclear Power
—Eugene M. Zuckert_
_"_
,
By RALPH A. BING
Commenting
LicHTtnsitiii
B. S.
Articles and News
news,
/cora-
quotation
bank clearings,
.qity news, etc.l.
Other Offices* 135 South La Salle 8t.,
Chicago 3. 111. .(Telephone: STate 2-0613):
Other Publications
Bank and Quotation Record —
Monthly,
$30.00 per year. (Foreign postage extra.)
Note—On account of the fluctuations in
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*
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DETROIT
PITTSBURGH
GENEVA, SWITZERLAND
r
A
The Commercial and
Financial Chronicle
(1112)
4
initial
Sales
Development
By DONALD K.
BALLMAN*
Sales Manager, The Dow Chemical
Company
of developing sales for new chemical
In describing methods
Traces history of
be undertaken.
cess versus
hypothetical product through
as
and
of solving laboratory, patent, and market research
problems, leading finally to sales promotion activities. Stresses
complexity of new chemical products and difficulties in ap¬
praising their commercial value.
processes
be
and
made
Common Stock Investments
By ROGER F. MURRAY*
Vice-President, Bankers Trust Company, New York
of
Mr.
rewards of suc¬
seek
is as
pessimism,
unwarranted
it is the
function of the de¬
make
sufficient facts
with
rewards
the
certain
as
City
principal hazards confronting sayings
(1) temptation to
stock investments:
common
high immediate yield; and (2) excessive devotion V
as major considerations to success
a
"defensive" stocks. He lists
or
velopment team to provide man¬
agement
Murray points out
banks in their
the cost of failure. The
rose-colored- glasses
of
use
bad
are
examination
chances
the
products, Sales Manager of prominent chemical manufacturer
reviews the various research stages and promotion projects to
Savings Banks7 Hazards in
favorable, the
product is given a closer scrutiny.
Many profitable items in com¬
merce
at present probably have
not appeared attractive
at. first
glance.
It is imperative that a
critical
Thursday, September 25, 1952
potential
comments, after a cursory
examination,
For New Chemicals
General
the
of
analysis
product.
If the
...
failure of any
which should be
to
and
are
worth the risk involved.
to
(3)
put
proper
away
stock purchase
program:
(1) rate of return
sought; (2) "defensive" strength desirable;
timing of purchases. Holds savings bank "ought
the income yield book, and acquire stocks
on
basis
managements have
of future earning power."
The rise of the chemical indus¬ try, the chemical production field projects of all types constantly be¬
fore them for review.
Our as¬
I know that you have long since paratively near future, then you
has attracted men who prefer to
try as a dominant, creative force
sumed
chemical
must
compete debated and resolved the
general have a promising investment re¬
is one of the least understood but explore rather than exploit
.
.
.
most profoundly influential hap¬ men who have visions of produc¬ against the other projects for the questions involved in entering this gardless of what current return it
right to have management put new field of savings bank invest¬ may show.
penings of the ing low-cost useful things for
their approval, that is, risk money, ment. Some of
This is obviously quite a dif¬
T wentie th every phase of human endeavor.
on the project.
ferent
you
have al¬
approach from that fol¬
Century.
The
As the industry mushroomed in
lowed in appraising bonds.
motto
of
the
ready started
We*
size, the problem of translating
Risks Must Be Taken
common stock
look at a bond to satisfy ourselves
American ideas into
products became cumBecause of the very nature of
Chemical
So¬
that there
is a real margin of
programs and
bersomely complex and the ex¬ the chemical
business, the chemi¬ others
have
ciety's Dia¬ pense became tremendous. As the
safety
for
unforeseen
develop¬
cal
entrepreneur must be more decided to
mond Jubilee,
ments in the company's ability to
result, there was, of necessity, es¬
willing to take risks than the take
the
meet interest and principal when
"Chemistry— tablished groups charged with the
managers of many businesses. The
due. Bearing in mind the degree
Key to Better job we have come to know as
plunge in the
success
rate of new products is
near
future.
of confidence merited by a com¬
Living," cor¬ commercial chemical development.
lower—often he is dealing with
It is time to
rectly implies
pany's promise to pay, we open
In most companies, commercial 100 to 1 odds in the
preliminary
that we are on
get
down
to
up our yield book, determine the
chemical development is usually development stages — but the re¬
the brink of
yield at the offered price, and
conducted by a highly coordinated ward is frequently greater since cases, there¬
reach our decision.
Most of the
opening the
and
to
team. Men of specialized abilities he works so often with abundant fore,
door to new
deal
with
time, we are principally concerned
in the research, production, pro¬ materials and almost limitless
Company
discovery pro¬
motion and sales fields combine
ductivity and
their talents to market saleable
utilization of chemical products.
products of the company, which,
The industry is still relatively
after all, is the basic reason for
young, highly imaginative in its being in business.
Donald K. Ballman
leadership
tious.
ambi¬
extremely
and
Since it is
a
creative indus-
must realize that no
within a chemical
company can mature a new prod¬
uct with efficiency. The new-born
chemical is frequently a problem
child, with a personality of its
own,
requiring many guiding
ment,
single
from
♦Extract
paper by
Mr. Ballman
the ,Annual Meeting of the
American
Chemical
Society,
Atlantic
City, N. J., Sept. 16, 1952.
prepared
for
For the financial, commercial
and technical aspects
CHEMICAL
group
until
reaches
it
the
ma¬
turity of volume sales.
of the
A
new
being
PROCESS
as
product may come into
the result of an idea from
customer, a thought
of a company repre¬
sentative after contacting outside
potential
a
on
INDUSTRIES
ask the
one
hands
the part
researchers
specialists in tha
in
one
or
by
the
of
an
inspiration
company
labora¬
tories.
industry... consult ARIES &
Creation of
ASSOCIATES.
a
New Product
The creation of the new product
The
Aries
chemical
organization
and
process
has
served
manufacturers,
extensive
detailed
and
in¬
formation necessary to
risk
demands
that
justify the
which
specialists in
the various lines of endeavor pre¬
of
the
about
immediately starts the develop¬
machinery. The machinery
ment
into
we
a
complete story.
different
should
of
Although
the
must take up the work of
groups
assume
separately,
we
several
all
that
or
the
the
outlook
for
interest
rates, the relative position of the
policies
and
points of view
Roger F. Murray
dictate
the amounts and. types of individ¬
ual stocks to be purchased. We all
mechanism sent a clear picture of each seg¬
recognize that these are the con¬
chemical develop¬ ment that later can be assembled
successful
of
The
the
understand
To
some
markets.
issue in the
market, and trying to
out-guess other bond buyers in
finding favorably priced situa¬
tions.
Once
we
have
formed
our
the
company's
siderations which will determine ability to pay and satisfied our¬
the success or failure of any stock selves that its position will con¬
program.
They deserve our most tinue to be at least as good
careful analysis and appraisal.
as
it is this year or was last
I
shall
deal
with only
three year, the yield book becomes our
judgement
on
independent investigations
can
be occurring simultaneously. aspects of this broad subject: first, guide.
In approaching common stocks,
Above
all, coordination of the the question of the rate of return
which you
should seek; second, however, we ought to put away
many specialists is mandatory.
that yield book. Our appraisal has
The development procedure be¬ the amount of defensive strength
to be of future earning power un¬
gins in the laboratory from which which is desirable; and third, the
der varying conditions. Consider¬
the new product was synthesized. emphasis which should be given
ing the known and unknown con¬
A few grams or, at most, a few to the timing of purchases.
tingencies in the outlook, the final,
pounds of material have been pro¬
decision on purchase or sale must
Put Away the Yield Book
duced in the beginning. Physical
be in terms of what we are willing
properties should be investigated
My first point has to do with
to pay for that kind of earning
immediately upon synthesis of a the question of yield. We all agree,
new compound.
These will be re¬ I am sure, that savings banks power. It is obvious that if earn¬
expectations are
realized,
quired for; process development were authorized to buy common ings
dividends will take care of them¬
and initial market investigation. stocks for the
purpose of improv¬
selves.
Consideration
of pilot plant or
ing their earnings and not in order
Thus, the logical conclusion is
greater
production
requires
a to obtain trading profits.
By this
study of possible processes with we ought to mean the rate of re¬ that we should not be greatly in¬
fluenced by the current rate of re¬
special emphasis on relative ease
five-year
ten-
may
merely sputter and reject the and
new
material for
turn
over
a
or
a
selecting either individual
stocks or groups of stocks.
We
proceed smoothly given to the availability of raw
should concentrate our attention
there is no contract as in a bond
•
with
all
the
Merger and Consolidation Studies.
gears
turning in materials for the proposed proc¬
primarily on future earning power
or mortgage, no preferential claim
well
oiled
fashion.
There
are
and only secondarily on yield.
ess and the economics of purchas¬
I
on
•
earnings as in a preferred
New Product Analyses.
many factors that enter into the
would not set any specific target,'
ing rather than manufacturing one
stock, and seldom even definite
degree of success for a new chem¬ or more of the intermediates.
therefore,
in planning a stock
assurance of a particular rate.
• Techno-Economic Studies
It
for Pro¬ ical.
Development groups which
portfolio. In the present market,
Necessary purity of the saleable is
only as we look back over the
may be located within the sales
the range might be from about
spectus Use,
product must be determined for record that we can
say what yield
or research departments or which
its effect upon the process.
4y2% to 5% at the most. I would
The a stock has
actually provided.
• Techno-Economic
may
be separate entities have end use will limit or define the
Audits of Com¬
have
fairly serious reservations
The pertinent question, then, is
been established to rapidly deter¬
contaminants which may be pres¬
about
buying a list of stocks
panies.
what will a particular company be
mine the potential of the infant.
ent.
which showed a current return in
By-products or co-products able to
pay its stockholders next
•
We might consider the devel¬ must be accounted for as to sales
excess
of 5%, because I would
Selection of Projects for Invest¬
year, or
five years from now,
opment group as the fuel pump value. Sometimes these unwanted
suspect that prospects for a good
ment and Company Expansion.
rather than what it paid last year.
for the engine.
It keeps informa¬ impurities become the most sought
long-range experience had been
If you can reasonably determine
tion correlated and flowing not after chemicals, but in this analy¬
sacrificed for the sake of immedi¬
Let the Aries experience in chemical
by careful analysis that a com¬
ate income.
only within a company but also sis they should be presumed as
pany's favorable position in a good
processes
and the chemical indus¬ from one company to another, liabilities unless information to
Don't Be On the Defensive!
industry will enable it to pay you
tries aid you.
We furnish complete just as the fuel pump sustains the the contrary is at hand. Conse¬
6%, 7% or 8% or more on your
My second point deals with the
operation by taking its quently, the process should be
"know-how* for new, proven proc¬ motor
purchase price within the com- function of so-called "defensive"
driving power from the engine. adjusted for minimum appearance
esses
ranging from fine organics to
stocks. A good case can be made
Once the initial energy to turn the of
other than primary product.
♦An address by Mr. Murray before the
tonnage chemicals to investors and engine is
provided, the develop¬ The development of a suitable Annual Meeting of Group Five Savings for including representation in
Banks Association, Brooklyn, N. Y., Sept.
ment
companies.
Our integrated service
group
acts as a clearing process also includes consideration
Continued on page 38
23, 1952.
house for data until the product of
safety and control features
requires no additional research on
is established on the market in which may be required of a pilot
your part.
one, or preferably more, end uses. or commercial plant.
Miscellaneous problems of the
With our center of activities lo¬
Without obligation, write
for our
cated, let us take an inside look future, such as waste disposal will
newsletter Chemonomics.
a
portion
of
process
at the various parts of the ma¬ consume
chinery in motion.
In normal study. Our company has one of
the most modern waste disposal
R.S.ARIES & ASSOCIATES times, and especially in our tax plants in the
country. It is de¬
conscious economy of recent years,
Circular available on request
to handle large volume
CONSULTING ENGINEERS a careful study of the suitability signed
of the product for manufacture chemical wastes of every descrip¬
*
I
tion because of this type of fore¬
vessential.
A few points are
ECONOMISTS
# is
quickly judged and may decide sight on the part of our manage¬
underwriters and investors in:
ciency
or
it
an
obvious defi¬
economy
of
manufacture.
Careful consideration must be
year
period. No
what dividends
one
a
really knows
stock will
may
turn in
pay;
-
Seabrook Farms Co.
i
SPECIALISTS IN
CHEMICAL
" the
PROCESS
INDUSTRIES
190 Madison Avenue, Now York 17, N.Y«
fate
of
the
product.
Avail¬
ment.
Coincidental
with
the
factors
ability and cost of raw materials
studied
in
the
laboratory,
the
and process equipment, familiar¬
sales development group is gath¬
ity with the reaction techniques
involved and profit incentive are ering data, preliminary in nature
Continued on page 37
important considerations in the
Frederic H. Hatch & Co., Inc.
Members of New
63 Wall Street
York Security Dealers
Association
New York 5, N.
Y.
Number 5154
Volume 176
...
/
The Commercial and Financial Chronicle
(1113)
Mexico's
r
Steel Production
The
Trade
Retail
Commodity Price Index
Food Price
With
Index
Miniature "SEC"
a
Auto Production
and Industry
To
the Scene
on
MEXICO
CIT^Y—Although
the between 8 and 15%.
still turn to the holders is
The net
re¬
business
recent
rapid growth enlarged by the prevailing use of
bearer
form
of
country's boom makes the
certificate
small,
its
the
nation-at-large the past week as many
its
production for
plants continued to
from the recent steel shut-down.
here
is
market
practice
itself is not only increasing its capacity but
is operating at full tilt.
In the week ended Sept. 20, production
of steel for ingots and castings was at a rate of 102% of capacity,
or 1 point above the preceding week and only one-half of a point
below the year's high mark just before the steelworkers' strike.
The steel industry
the
further
even
which facilitates tax evasion.
eight-hour day.
an
the
American
financial
and
Mexico
$17.86. - The increase amounts to 10.4% of that average.
topping the Wage Stabilization Board formula, this
trade journal notes.
seen as
This
was
settlement born in haste to avoid
a
strike.
a
It
•
re¬
flected industry's desire to avoid another economic
ful maneuvering by Mr. Lewis which split the coal
crisis, master¬
operators into
manageable segments, and determination of the coal producers to
resist cutting the number of hours in the working day. The work¬
ing day stand had to be paid for by an increased wage offer.
Probably the biggest factor in determining how soon and to
what extent controls are removed will be the election this fall,
states the
above trade
authority.
For this reason, much of what
is said about controls and the need for them must be taken
window dressing.
as
pure
This week the steel market is
a paradox.
Consumers are ex¬
available pound they can get.
But consumers and producers alike expect the intensity of demand
to begin tapering off in the early part of next year. When that
happens the differences in demand for various products will be¬
come
strikingly apparent.
At present the impact of 19 million
for
pressure
every
tons of steel lost because of the strike makes
appear
nearly all steel items
uniformly tight, states this trade journal.
Working off the tremendous
of old orders is one of
the sternest jobs facing the industry.
This is highlighted by the
National Production Authority announcement that most manufac¬
turers of civilian goods will be permitted a first quarter quota
.allocation only 75% as large as for fourth quarter of this year.
This is in spite of the fact that they expect the industry to hang
up an all-time production record during that period.
The goal
is to clean up all carryover orders by the end of the first quarter,
concludes "The Iron
More
cars
were
carryover
lion
and
value
industry will hear
this
was
a
statistical
agency.
"favorable"
decision
Authority regarding steel
week
that
the
soft-coal
strike
averted when John L. Lewis
It
is estimated it
The miners
new
will
won
and
rents climbed
those for
a
cost
won
a
the
of
170,000
the
largest
was
on
3%
more
10-cent increase in
between
July 15
up
and
stocks
the
on
York
New
Stock
change.
thus
placement
has
far
securities
of
been
Ex¬
•
.
The
later
sion's
preceding
quoted
investors
which
price.
listed
ses¬
Institutional
confined
are
are
execution
price geared
a
exchange
on
to
issues
exchange,
an
but may still buy them over-thecounter.
:
becoming increasingly popular
and
the fastest growing sector oi
the
securities
There
business.
-v-.
its
atti¬
cifically applicable to investment
trusts; but since
such,
satisfied
its
toward
none
registers as
to the present they are
up
.*
generally
,
regulatory laws spe¬
are
strictly academic.
SEC—Mexican Version
panding
vestment and
omy's
banking community
differs sharply from that existing
*
*
Assuredly the
supervisory and
regulatory body, the Mexican in¬
course
of this ex-
Latin-American
econ¬
will
activities
investment
bear interested watching over
the
largely
con¬
years.
that the public confidence derived
from the existence of a super¬
visory
body
in
COMING
mushrooming
securities situation is serving as a
a
centrated in the hands of institu¬
EVENTS
constructive help to such growth.
tional
This
investors,
which
justifies
expectations of much further
mar¬
ket
expansion among individuals.
On-the-spot
investigation
indi¬
that
cates
fear
inflation
of
been only a minor
hind
has
motivation be¬
to the present the Commission
up
Comision Nacional
—El
ras—has confined
de
Valo-
itself to lenient
cooperation with the industry.
The Commission is administered
by
Stock Exchange Organization
board
a
of
eight
sioners, each of whom
Mexican
In
Investment
Field
"honeymoon" attitude is, of
course, enhanced by the fact that
equity-popularization.
The
have
and
each.
Prices for
year
ago
and
15,
Commis¬
Sept. 26, 1952
Bond
Club
(Philadelphia, Pa.)
Philadelphia an¬
of
nual field day at the
Huntingdon
Club, Abington,
Valley Country
Pennsylvania.
consisting
2,000
of
($235)
pesos
admittance
prerequisite
membership.
change
for
Only
an
Ex¬
such
broker-members
are
trade within the
Exchange house,
hence private
and
their
them
investors send
orders
execution
for
the next trading
at
permitted to
session; these
extending
Exchange
hours
11:30
price
This
above the level just
represents Sept. 26, 1952 (Rockford, 111.)
page
30
government de¬
Rockford Securities Dealers As¬
including the Depart¬ sociation, annual "fling-ding" at
of Finance, the Department the Mah
Nah - Tee - See Country
ment
-
the
Bankers'
Sept. 28-Oct. 1, 1952 (Atlantic
The Chairman
of
the
Board
Commissioners, appointed by the
Department of Finance, occupies
a
full-time
other
while
position,
members
of
the
the
Board
are
only required to attend meetings,
principal
Commission
To
are
grant
privileges
—
American
Annual
duties
of
the
the following:
Bankers
Association
Convention.
Oct. 2, 1952
(New Jersey)
Bond Club of New Jersey mem¬
ber-guest
usually held weekly.
The
City, N. J.)
of
and
Beef
Dutch
Steak
treat
Golf
Dinner
at
Essex
59 broker-mem¬
now
are
(with
41
places
open)
the Mexican Exchange, and 25
Monterey.
There
is
no
Exchange
concerning
in
equivalent, the broker-mem¬
merely having assistants to
them
keep
track
were
for
purposes
of record. These securities
placed privately through the undersigned, and have not
been
and
are
not
being offered to the public.
or
bers
help
This announcement appears
separate
"category of customers' broker
its
on
of
their
$500,000.00
orders from the public.
Over
half
the
of
with
business
of
most
occurring
participation
Financiera,
activity
on
Leonard
Refineries, Inc.
place in bond
of
the
stock
in certificates
of
the
6% Preferred
Nacional
government-con¬
a
trolled
investment trust function¬
a
as
kind of RFC in making
equity advances to
and
private industry.
Industrial
afford
and
liberal
line
,
.
mortgage
yields,
with
the
of
bonds
about
National
The
yield
on
leading stocks ranges
Day
the
County Country Club, West
listing Orange, N. J.
Continued on page 6
which
from
Savings Bonds which yield 7.17%.
on
or
o'clock.
1
to
8%—in
Continued
institution
partment;
200,000
apeice, acquisition of which is
credit
consumer
prior to the Korean outbreak.
of
ing
apparel declined 0.1%,
12.3%
of
issues,
Aug.
Fuel and elec¬
Aug. 15 stood at 191.1% of the 1935-39 average.
a
capital
a
the Exchange takes
home-furnishings remained unchanged.
higher than
The Exchange
($23,500)
shares
the
0.6% in the latest period; retail food prices
0.3%
The United States Bureau of Labor Statistics'
index
industry
$1.90 increase in the
high for the third straight month.
tricity costs went
listed
for
in the United States, Great Brit¬
million), contrasted with ain, and the Continental countries.
$114 billion of stocks alone listed It is pretty generally felt here
There
operator-paid royalty to the UMW welfare fund.
Living costs increased 0.2%
a
the
from~the
are
i
($825
industry's fourth quarter operations.
present basic daily wage of $16.35 and
setting
of
the
to
bonds has grown to 7 billion pesos
pesos
than $300,000,000 a year.
30-cents
to
Thi§
tion,
including
a
doubling
of
petroleum output. The total mar¬
their / orders
the counter at
over
tude
national
They
..manner.
certificates
.
withhold
In
the
in
sell
active
must
auto
hour.
million).
trust
steadily
assembled last week than any other week in
and fringe increases in the United Mine Workers' history.
The agreement calls for direct wage and
fringe boosts of about
an
to 5,473 mil¬
vestment
Association,
wage
cents
($644
is¬
million
218
less
Exchange,
84% expansion of produc¬
an
bers
31
from
and
on:
Similar to the
York Curb
the New
on
Bank,
next week from the National Production
learned
per
the
income,
rise
com¬
issues, large public, with a redemption privi¬
investors have adopted the habit lege— the
counterpart
of
our
of
instructing their brokers to
open-end funds.
As here, they
in
market expansion reflects a seven¬
fold
-
investment
no
important- panies, act in the traditional in¬
both
in
etc.
output is in prospect," said the
Northern miners
the
large
board of directors.
a
drive to make up for losses due to the July
3-Aug. 18
plant shutdowns due to the steel strike, car producers used
overtime and extra shifts to push their output high.
is
ex¬
of fixed-income
risen
pesos
are
outside
Age."
In
It
latter
($770*000) i
($26 million)
pesos
.There
the Central Club.
auto
allocations for the
has
of.
of National Economy,
"Ward's Automotive Reports."
predicted the
the
pesos-
amount
70%,
Mutual Fund
Movement
typical American corporation, in¬
cluding administration through a
105,135 cars made in United States plants, or about
2% more than the 102,763 in the preceding week and 5% above
the 100,299 put together in the like 1951 week,
according to
It
On
the
dealt
exchange.
situation
month..fr:\
vs r>
Since
1939
the
general stock
price index has risen fourfold,
with industrial shares-up 575%.
sues
at
effected
are
of
are'
off the
V-*
v.
City.
million
That Inevitable
an
were
"Greater
-
in
May
increased by
510%, now running at 6.6
full
The
the
To govern admission of Stock
Exchanges are
organized as "Sociedades Anonimas," an entity similar to the
the past 15 months.
There
Wilfred
A.
last five years have
ket
.
From a practical viewpoint, steel people expect to start gain¬
ing in the long race to fill supply pipelines during the fourth quar¬
ter.
By the first quarter of next year they expect a number of
products to be in ample supply.
Balance in supply and demand
of major tonnage products is expected during the second quar¬
ter, it adds.
erting all-out
Most
issues
change.. transactionsduring
about
was
and
on
panies or mutual funds denoted
exchange, where the market by that nomenclature, but credit
is indeed more liquid.
^
institutions, including trust com¬
in cipal
market
.
rates
the
the
to
estimated
transactions
City
ly:<,
a
maximum
interest
over-the-counter market. A large
majority,
added
to th^> and the "package" won by the union equals about
310 per hour.. Average daily wage of the northern coal industry
This is
regulatory community, is the sec¬
ondary position the Mexican ex¬
changes have always held to the
in¬
recent
money
determine
Exchange members, and
To watch closely investment
companies and their operations.
to
Monterey'
having been
>
offerings of Mex¬
foreign markets.
Mexico, and of particular interest
dustrial
will give miners 23%0 per hour on
Tack the 100 per ton welfare fund
in
regu¬
of
pr
issues
inter¬
; booming
,
the only,
obligations of credit institutions.
esting.
,
To approve
minimum
"*
dig deeper into its pocket to pay for
the higher cost of coal resulting from the quick settlement of
northern coal producers with John L. Lewis' United Mine Workers,
states "The Iron Age," national metalworking weekly* the current
week.
The settlement of $1.90 per day increase in wages and 100
per ton more to be donated to the union's welfare fund will cost
steel mills from 500 to 600 per ton of finished steel.
Their coal
costs will rise between 370 and 400 per ton.
are
One of the most striking char¬
acteristics of investing activity in
"SEC"
lation
The steel industry must
offering
steps in.
To
Mexico now
recent weeks total output did not vary sharply from,
has two stock "
the high level of a year earlier; however, it was about 10% below
the all-time peak reached during World War II.;•> Insofar as claims
exchanges; a
for unemployment insurance benefits, were concerned they- re- *■ small
one ?in'
The actual wage increase
to
occasions when the Commission
ican
•
Over-the-Counter Domination
reaction to its
above the year preceding.
and public
and
public's
As during
the basis of
com¬
applications
on
directly to
the public. The events of listing
securities
midst
mained slightly
pass
offer unlisted issues
Steady progress is reported in total industrial
recover
Appearing
institutions and insurance
panies.
By A. WILFRED MAY
Business Failures
J
the
To determine the issues
elig¬
for investment by credit
ible
Securities Markets
Carloadings
State of Trade
they are quite strict, including
plant appraisal.
Booming
Electric Output
5
R. C. O'DONNELL & CO.
625 PENOBSCOT BLDG.
DETROIT 26, MICH.
WO 3-7010
*1
6
The Commercial and Financial Chronicle...
(1114)
resell the Defense Bond
and
Prosperity Should Not Be
SNYDER*
By HON. JOHN W.
vertising has so far played in
making the Savings Bonds Pro¬
gram a success cannot adequately
be measured, although its results
obvious.
are
Secretary of the Treasury
>
Secretary Snyder, in praising role of advertising in defense
real prosperity, now
efforts and in civilian field, points out our
as
is derived from permanent factors, such as popu¬
in the past
lation
growth, abundant natural resources, individual enterprise,
of scientific
wide distribution of income and increasing pace
discoveries.
;
of maintaining nation's financial
Says burden
strength has been placed
tax system.
on
The Stock Market's Path:
The tremendous part
Based On Defense Effort
'
pro¬
the people of America.
which ad¬
gram to
Thursday, September 25, 1952
Advertising holds
An "Obstacle Course;
By AUGUST IIUBER
.
a
^
Spencer Trask & Co.,
position
in
the
United
States
which, in comparison to its posi¬
tion in other countries, is unique.
Nowhere
else
is advertising
so
highly developed or so important
in the economy. It is to convincing
advertising that I attribute a ma¬
jor credit for the Tact that today
over one-fifth of our public
debt
is in the form of Savings Bonds.
In other countries—such as Eng¬
Members New York Stock Exchange
A
Market analyst, in characterizing stock market's path as "an
obstacle course," points to such hurdles as
steadily increasing
\
-
*
operating costs; mounting wages, the resulting squeeze on
profit margins; the tax burden; and consumer reluctance to
buy, along with other adverse factors. Lists as counteracting
'
•
favorable factors in market outlook: (I)
prospect of continued
high level industrial activity; (2) relatively firm commodity
prices; (3) steadily easing credit restrictions; (4) full employ¬
through the ingenuity, the will to
land, France, and Canada—which
do and the clarity of thinking of
have also made efforts to sell gov¬
ment at high wages; and
the American people that while
many of the burdens of actual war
(5) high volume of individual sav¬
ernment securities particularly de¬
—requires a tough and long-last¬ we have met the demands of the signed to attract the savings of
ings. Advocates conservative stock market policy.
defense program, we have at the
ing brand of
small investors, the corresponding
*.***»
same time enjoyed a real prosper¬
patriotism.
It
During
recentJ weeks
stock from the peak of $30.70 registered
figure is not more than one-tenth,
ity in this country.
requires a new
in 1950.
This is still well above
and in some cases is much less prices encountered increased dif¬
The prosperity
which we are
degree of
ficulties over the obstacle course the dividends of
than
$16.33 paid^ in
that.
Advertising has, in-(
now
enjoying, however, can
statesmanship
deed, been one of the key forces they: have been traversing this 19511 but the coverage has been
neither be measured by nor based
on the part of
year.
Recent¬
in the achievement of our sales
narrowing.
The dividend "payall
of
us.
It
upon our defense effort. While our
cut" was 52% of earnings in 1950;
/,-••••••'
goals through the years and will ly, the stum- s
defense- program has, it is true,
requires courbling became
61% in 1951, while the same rate
remain a key force in the future.
resulted in increased .productivity
age to face
more
o' payments would constitute 71%
To steadily maintain a success¬
pro¬
the facts and
and employment in defense and
of estimated 1952 earnings.
ful sales program, even after such nounced. This
to hold to our
defense-related
industries,
our
could
be • at¬
The
established
regular divi¬
real prosperity, now as in the past, astounding results - have been
pur p ose of
not
dend rates on most of the first
We tributed
is derived from more permanent achieved, is a difficult job.
preventing
cannot rest on our oars. We can¬
line stocks are fairly secure for
only to the
another
fullfactors—the growth of our popula¬
not assume that our job, or your more cumber¬
this year but a moderate diminu¬
scale war and
tion, the dynamic force of individ¬
some
hazards
tion in overall dividend disburse¬
: '
:
ual
preserving
enterprise
and
productive job, is ever done.
I want to pay a sincere tribute along the path
ments should be witnessed, pri¬
freedom and
John W. Snyder
Our
situation
present
short
all-out
of
one
—
with
but
war,
,
country of abundant
to the Advertising Council which
the wide dis¬
world.
We have, I think, made tribution of income, and the in¬ has so well served the Savings
The creative planning
substantial progress in that direc¬ creasing pace of scientific dis¬ Program.
and
the
technical
skills
which
tion in the two years since the coveries.
invasion
natural
of Korea.
Our national defense program
is
which they are
basic
developing
further
in
resources
element
in
uct
our
for
and
guidance has performed
products, but neither will miracles of persuasion.
new
many
It has sold
in expanding
and
prove profitable unless the prod¬ many
worth-while ideas; it has
capacity, as- well as uct is effectively brought to the
in providing additional military attention of the masses
of our delivered^impressive results; it has
production capacity to be used in people who furnish the great mar¬ done an u important job for the
the event the communist leaders ket
potential for these goods and public welfare. But as I have said,
insist on bringing about full-scale services.
Advertising is assuredly your job is never finished.
war.'
' !
the great connecting link between
I personally, fervently hope for
We should
business
however,
productivity
industrial
our
not,
un¬
derestimate the magnitude of the markets.
job still before us. National se¬
curity in these troubled times does
not come cheaply or without ef¬
fort. This fact is
apparent, if only
growing complex¬
ity of military weapons, of which
our aircraft is
a particularly
sig¬
nificant example. The first B-47
"stratojet" medium bomber re¬
quired 3Y2
million
engineering
man-hours, compared to only 85,-
because
of
the
man-hours
000
duction
model
standard
most
of
the
for
first
the
of
heavy
World
bomber
War
pro¬
B-17—our
during
II.
At
a
time has advertising been
vital to our business econ¬
than
omy
years.
in
the recent
wartime
from
production
peacetime products,
had
kets
postwar
to
creased
be
found
of
supply
services
American
increased
the
Automatic
older B-29.
de¬
vices—many of them electronic—
to provide the pilot with greater
and
more
accurate
fire
power
or
The
a
and the bond program in the
ury
mar¬
the
goods
in¬
and
ahead.
years
arable
substantially
advertising budget,
communicatnon
result
has
team,
I
as
insep¬
an
hope
that
the
able to continue to
to the
be
mediums,
been
solid and expanding demand for
goods and services, and
to provide business with new and
growing opportunities for profit¬
consumer
of combat success, require tons of
increased
incomes
equipment in
been
by
business
plane where a few
pounds
used
to
be
a
generated
high-level
which
the
have
resulting
activity, and
from the increasing array of new
enough. The stronger construction
products and personal living con¬
to
withstand
high-speed
conditions demands tougher and veniences which are daily enrich¬
heavier materials, while new jet ing our lives.
needed
engines, developing as much as
25,000 horsepower—-2% times the
power of the combined four en¬
5
page
If we are to assure the continu¬
of a B-29 Superfortress—
required the use of new ance of this real prosperity, how¬
heat-resisting alloys demanding ever, we need In take positive
larger amounts of metals already steps to maintain the strength of
in short supply.
our
financial
system, which
is
we
as
tell
consider the
a
you
then, when
defense
program
whole, that all of this is
ex¬
basic to the smooth
functioning of
all sectors of the economy.
This
is the burden placed upon our tax
pensive; that all of this necessary system and on the Savings Bonds
preparation places a burden on Program by our defense effort.
our economy. It has been a most This is the reason why it has been
remarkable experience that so important to increase our rev¬
during the past few years.
This is why it is so important that
enues
•From
at
the
an
address by Secretary Snyder
Annual
August Huber
of the
participating \
•
equities, as the result of their con¬
tinued'exertions in coping with
,
Oct. 5-7, 1952
Meeting
of
the
Board
of
double
and
Directors of the
we
New York
forts in the months
Advertising Council, Inc.,
City, Sept. 18, 1952.
*or
over
redouble
our
ef¬
ahead to
sell
back
mately the
started.
wages,
ceilings
Exchange
Governors
the
Mark
Fall
Hopkins
1952
(Los
a
the
burden, all with reflection in
Association
declining
Board
of
Stock
of
Oct. 20-23, 1952
National
Exchange
Governors
Fall
revolved
so
of
around
and
corporate
the
(Miami, Fla.)
Security Traders Asso¬
Convention
at
the
Rone?
Oct. 24-27, 1952
National
(Havana. Cuba)
Security
Traders
sociation Convention
31, 1952-Nov.
As¬
the
corporate financ¬
new
uncertainties, the enigma
in
war
Korea,
along with
psychology
investment
Meeting
of
Southeastern
at
The
Nov. 30-Dec. 5, 1952
(Hollywood, Fla.)
Investment Bankers Association
wood Beach Hotel.
of
at
with
the
first
continue
the
increasing bureauc¬
resultant
impairment
and
speculative
investment
non-callable
line
stocks.
ferred
Holly¬
on
currently afforded
the 4.11%
by
the
bonds
2.90%
industrial
grade
and
spread
favorable
a
average
However,
pre¬
the
un¬
derlying trend of money rates has
upward
been showing
and
a
the
issues
bond
over
to
relatively
being
favorable
have
bonds
modest downward
volume of
The heavy
tendency.
new
marketed
be
nearer
A con¬
tate successful distribution.
tinuation of this trend
would not
to ad¬
particularly conducive
be
term
forced to carry more
interest rates to facili¬
vancing stock prices, especially at
a
time when earnings are reced¬
ing and the dividend coverage
is
narrowing.
A more fundamental considera¬
tion
for
and
institutional
term investment
accounts is the
fact
that income
from bori^s and
longer
preferred stocks is on a fixed basis
whereas common stock disburse¬
fluctuate
ments
more or
over
the
years
less in line with net earn¬
ings.
In
connection it should be
this
recognized
last
ments
time
peak.
that
year
dividend
were
Hence,
pay¬
at an all-
the
present
yield of 6% in the Dow-Jones In¬
dustrial Averages must be gauged
in that
light. Common stocks pur¬
a historically high price
chased at
confidence.
Although the trend of corporate
level
for
longer term
investment
are likely to show a less favorable
pebble in the
return on average dividend dis¬
market's shoe for some time, one
bursements over a period of vears.
of the fundamental sustaining in¬
This results in a less marked dif¬
fluences on common stock prices
ference with the fixed income de¬
has been the relatively favorable
rived year in and year out from
yield afforded by equities. This
bonds and high grade preferred
has been manifest in a persistent
stocks:
There are also the fluc¬
demand from investment and vari¬
tuations in market price and dim¬
institutional
a
sources.
principal
inution
Homestead.
Annual Convention
racy,
in
sidered
during
to
possible
be. con¬
interim
Dow-Jones periods of reduced dividend pay¬
ments.
At the present Dow Jones
Industrial stocks declined to $5.73
Industrial price level of 268 the
per share in the first quarter of
yield on the average dividends of
1952, compared with $7.14 a year
the past five years wouM
4.8%.
earlier.
Second
quarter
results
Over the last ten years 3.8%.
are
likely to be modestly below
Since the past ten-year soan in¬
those of the first quarter. Profits
for the full year may run around cluded a war period with its at¬
Earnings
America
would
Industrial Earnings
Group of the Investment Banker.5
of
tory would be on the deflationary
side or whether a Democratic Ad¬
2, 1952
(Hot Springs, Va.)
Association
vagaries
the
with
coming elec¬
tions. Important questions revolve
around whether a Republican vic¬
ous
tour.
record
far this year, rising money
severe
labor disturbances,
earnings has been
Plaza Hotel.
Fall
of
trend
trend toward
meeting at the Ambassador Hotel
Oct.
prices
advanced
ministration
Angeles,
Calif.)
Firms
on
reluctance to
or consumer
at
associated
Stock
of
at
8-10,
squeeze
profit margins due either to price
.buy
highest
are
resultant
a
general
Hotel.
Oct.
factors
creasing operating costs, mounting
of
(San Francisco.
of
Board
meeting
obstacle course there
as
steadily in¬
an
such
market's
the
on
still
the
been
>
also being confused by the
Association
Firms
when the year
same as
:f
now
approxi¬
or
characterizing
path as
.are
268
around
to
In
The market is
to 280.
vance
Aver¬
last year's divi¬
dends of $16.33 would be 6%.
A
redaction to $15 would provide
5.6%
year
Industrial
Dow-Jones
at 270 and
started the
have
enter¬
Ajt the present level of 268 for
the
pivoted around that axis ever
since.
A
subsequent decline to
about 256 was followed by an ad¬
ages
individual
the
to
the yield
foreign
Calif.)
adverse
prise.
ages,
ing
COMING EVENTS
During the current
number of secondary com¬
panies have reduced or eliminated
due
to
developments
many
volume
from
result of fewer year-
a
dividends
effectively sell,, earnings. Additional obstacles and
less
encouraging
developments
Strength
gines
not
p p
rates,
ciation
Steps to Maintain Our Financial
have
need
a
as
"extras."
year a
overcame
have
Continued
create
to
production and the expan¬
bombing performance, more ma¬
sion of production facilities.
Our
neuverability, day and night com¬
have benefited from the
bat capability, and a better chance people
I
which
arently
fatigue
American people.
able
hundred
end
tax
aid, will
your
Not only has
business
its
Acting
Treasury, with
it was capable of
thrift
Advertising
helped
find those markets.
new
new
for
relationship of the Ad¬
vertising Council with the Treas¬
which
producing.
the old B-17 bomber, and today's
B-36 weighs 2% times as much
continuation of the friendly and
effective
As American business con¬
verted
but
mass
no
more
to
and
such as television, have made it
Today's Navy or Air Force jet
possible for advertising to be more
fighter weighs nearly as much as effective than ever before.
as
marily
mounting
advertising.
notable prog¬ the efficient
production techniques
We have made
ress
vital
most
but also to the
Defense Bond advertising. During the
handicaps which confronted
Inventive minds
the last ten years, public service them.
can
make new
discoveries, and
advertising, under your leadership
scheduled to level business management can devise
The Dow-Jones Industrial Aver¬
proceeding at a rate. in excess of
three-fourths
the
peak rate
at
off.
a
resources,
weld¬ have been brought to this program
by the eight leading advertising
ing these permanent factors into
unparalleled personal and national agencies which serve as your taskforce are performing an important
prosperity is the increased utiliza¬
function in the development of
tion which is being made of prod¬
A
already well advanced. Deliveries
of all military procurement items
have risen .steadily and are now
,
in
power
,
decency in the
$23
the 30
share on the "Averages," tendant severe economic disloca¬
with $26.59 in
1951, tions and profit restrictions, ade¬
continuing the downtrend quate allowance must necessarily
per
compared
thus
on
Volume 176
The Commercial and Financial Chronicle
Number 5154
(1115)
be
made.
granted
on
in
view
into
Moreover,
of
the
point
stocks
looked.
Industrials,. after -reaching
longer term
significance
when
this
main
earnings
and
stocks,
because
have
been
a
to
to
from
Utility
be
examined
at
this
the Government exercises its
on
more
;
by
the
this
mate
low
probably approximate those shown
and
A
by
level
points
last
This announcement is under
in
'
.
r
nny
«'•
.'/'
•
•
strictions
consumer
'iii:„>•''ffi'»•
;
i-
and.;, high
goods and
tained at
•
market
become
was
has
year
from
there
was
market
more
power
early
^*Jien
advancing.
been to
come
*excessively
bullish
objective
mary
The
trend,
Lightening
to
desirabld
the
issues
the
pears
ment
during
rather
moderate
on
'''
direction.
The decline
some
more
in market
than
prudent
more
V
-
v^
"
—
favorable
more,
sents
This
area.
opportunities for
(Special to The Financial
JACKSON,
.
."'V\"'
Chronicle)
—
August
switching
City
into
Bank
&
Trust
Building.
means
a solicitation of an offer to buy
any of these Bonds, and is published x
as may legally offer these. Boruls in sueli State.
of the Official Statement.
$65,000,000
'.
'
,
...
(Delaware River Extension)
'/■ ,'vC.v
'•
"
/■
(Initial Project)
historically, high levels,
defense expenditures of
billion monthly
some
;
$4.5
Payable solely from the Revenues
as
hereinafter described
through 1.953 'and
into
1954:
action
some
The
and
the
possibility
taxes
on
corporate
next
excess
of
$15,000,000
year.
profits
modification
some
in some quarters.'
There
is
'V
§50,000,000 3% due June 1,1982
.
.
V
,
anticipated
v
Dated
;
entwined in the
are
eud%%2
June 1,1970
tax
is scheduled to
expire June 30 and
September 1, 19.")'2. Principal and semi-annual interest (December 1, 1952 and thereafter on June 1 and December 1)
payable at Fidelity-Philadelphia Trust
Company/Philadelphia, or, at the option of the holder, at J. P. Morgan & Co. Incorporated, New York City, or at Mellon National Bank and Trust
Company,
Pittsburgh. The Bonds are issuable as coupon bonds, rcgistcrable as to "principal; in the denomination of $1,000 and as
registered bonds without
'•
.'•<
coupons in denominations of $1,000 and any
piultiple thereof i\nd are interchangeable ae. provided in the Indenture.
more
,favorable factors, briefly outlined
above, the likelihood that private
.
capital expenditures for plant and
Tlie Bonds may be
and in part, by lot,
equipment
for
to
now
running at a
$27 billion rate—will begin
record
—
taper off next
penditures
ence
on
and
Such
year.
exert
a
strong
general business
decline
any
to
could
Inter eat exempt,
influ¬
tend
Under the
to
These
are
now
in the opinion of counsel named below, from present Federal income taxes under existing statutes and decisions.
Enabling Acts, the faith and credit of the Commonwealth
The Bonds, their
mitigate in some measure the con¬
tinued high level of defense ex¬
penditures.
redeemed upon at least 90 days' prior notice, at the option of the Oomipission, as a whole on
any date from any funds available for that purpose
from moneys iii the Sinking Fund on any interest payment date, in either case not earlier than June 1, 1957.
Moneys in the Sinking Fund available
redemption shall be allocated pro rata to all series of bonds issued under the Indenture. The amounts allocated to the Bonds of this series shall be first
apportioned
the 1970 maturity. The redemption shall be at the
prices Set forth in the Indenture.
:
ex¬
activity
transfer and the income therefrom, including
ap¬
their peak of between
$4.5-$5 billion monthly—a plateau
expenditures which
should
.
maintained at least well into 1954
thus, while a definite sus¬
The Bonds
influence, such expendi¬
are not likely to
provide an
stimulus.
tion,
should
year,
may
device
omy
stimulating
which
as
an
a
econ¬
sagging
The
substantially
of
the
bonds
now
to be
V
'
issued under and secured by at) Indenture between the
Pennsylvania Turnpike Commission and Fidelityof September 1, 1952;. for the purpose of paying the cost of an extension to the
point near King of Prussia to a connection with U. S. Route 13 at a point north of
as
a
a
mile from the Delaware River.
hereafter issued under the Indenture dated June 1, 1948 shall have been
or
These Bonds
paid,
or
provision made for their payment.
offered when,
as and if issued and received by us and
subject to approval of legality by Mitchell and Pershing, New York, N. Y., Townsend,
Elliott & Munson, Philadelphia, Pa., Sehnader, Harrison, Segal & Lewis,
Philadelphia, Pa., bond counsel, and Theodore S. Paul, Esq., counsel for the
Commission. It is expected that delivery of the Bonds in temporary form,will be made on or about October
8, 1952.
quate insurance against presently
inflationary
the Bonds.
indus¬
trial facilities should
provide ade¬
foreseeable
on
and
expanded
country's
interest
are further secured
by the pledge of the tolls and revenues (over and above the cost of operation) from the PennsylvaniaTurnpike (Existing System), subject in all respects to the provisions of thelndenture between the Pennsylvania
Turnpike Commission
Fidelity-Philadelphia Trust Company as Trustee dated as of June 1-, 1948, and such tolls and revenues shall only be available
for the payment of the
principal, premium and interest on the Bonds issued under the Indenture dated September 1, 1952 after all
ten¬
dencies.
capacity
or
exempt by statute from taxation
are
The Bonds
have already de-
may
moderately
are
Bristol, Pa., and less than
next
largely
principal of
profit made on the sale thereof,
Commonwealth of Pennsylvania.
Such extension is herein referred to as the Initial
Project. The Indentureprovides for the issuance of additional Bonds under the conditions and limitations therein set forth, and all Bonds issued under the
Indenture are equally and ratably secured by the pledge of the tolls and revenues (over and above the cost of
operation) from the Initial
Project and any other Projects which shall be financed under the provisions of the Indenture.
reduc¬
later
come
eventuate
for
veloned
it
Tax
.
Philadelphia Trust Company as Trustee dated
Pennsylvania Turnpike (Existing System) front
taining
additional
not pledged to the payment of the
be
—and
tures
..
are
any
Eligible by statute for investment for Savings Banks and Trust Funds in Pennsylvania
and for deposit as security for public funds in the Commonwealth.
proaching
of
within the
•
pressures
are
from
monetary sources. The ex¬
pansion of productive facilities-
entailing
Price 100%
some
$130 billion
in
years—should be more than
adequate to meet the require¬
recent
of
ments
the:
civilian
along with the needs
of
Accrued interest from
economy
the de¬
•f"
fense. program as Scheduled."'Gen¬
eral industrial activity is current¬
ly running at 212 (F.R.B. Index
1935-39=: 100) and: should recover
to
around
year-end.
223
'The
again
plant
before
and
'
''
.
•' v
>
f
k
'
Drexel & Co.
'
'
'
"
■:
■
'
-'
r'
•
■
B. J. Van Ingen & Co. Inc.
should
some
now
rise
to
,
i
ff*-*
■
.
'
INCORPORATED s
and
"
1
next
285
year.
by
the
early
part
Obviously,, with
of
,
the
ability to produce well above in¬
dicated
demand,
the
*
Blair, Rollins & Co.
goods"
should
be
miti¬
gated if not largely eliminated.
The probable lack of
'
,
.
...
„
Yarnall & Co.
incorporated
: Equitable Securities Corporation
Stone & Webster Securities Corporation
Smith, Barney & Co.
I
Union Securities Corporation
Merrill Lynch, Pierce, Fenner & Beane
Bear, Stearns & Co.
Paine, Webber, Jackson & Curtis
Alex. Brown & Sons
Hemphill, Noyes & Co.
inflationary
possibilities arising from "dollars
chasing
INCORPORATED
The First Boston Corporation
Lehman Brothers
'
Company
Eastman, Dillon & Co.
Blytii & Co., Inc.
t
Kidder, Peabody & Co.
'
ajbout
'-5V
.
HarrimAn Ripley & Co.
A. C'.'Allyn
September l; 1952 to date of delivery to be added.
For information relating to the Pennsylvania
Turnpike Commission' and to these Bonds, reference is made to the Official Statement of the
'Pennsylvania.Turnpike Commission, dated September IS, Iff02, which should be read prior to any purchase of these Bonds, lite Official Statement
may Itr obtained in any State from only such of the underwriters, including lite undersigned, as may
legally offer these Bonds in such State,
'
-
country, as measured by
competent
observers, " is
260
'n
capacity of
the
.around
the
■•
new
strong
Phelps, Fenn & Co.
Salomon Bros. & IIutzler
1
Shields & Company
Stroud & Company
Incorporated
September 22. 1952
invest¬
G.
Seibold has become affiliated with.
H. H. Butterfield &
Co., Jackson
pre¬
favorably situated issues
Mich.
Pennsylvania Turnpike Revenue Bonds
/"
:
buying
still ap¬
policy.
C/OihiTLonwealth of; Pennsylvania
^ y:V-'.v
less
recovery'
weakness,
J
;
in
H. H. Butterfield Adds
drastic
than
others—has been bringing a num¬
ber of good trade issues into a
The offer of these Bonds is made My by
buying
commitments
movements,
pri¬
during the past
keep the investor
reserve
should not yet be utilized.
veering to extremes in either
prices
less
:'■>-■''■*K-*!•• .)•»•'-si,.
.♦
V
.
wage
rates,
supply likely to be main¬
money
to
reason
re-
housing, high level of individuals'
t savings,
comparatively full em¬
ployment
improved income
combination of such
a
factors
easing •of :A credit
on
or
nn-cifcumstanees to be construed as an offering of these Bonds for sale or as
Stutebn behalf of only such uf the underwriters, including llie undersigned,
V
better
prospects,
return,
compel¬
:
;dustrial activity
through the year;
* a
relatively ; firm general price
v
November
again in March and April of
NEW ISSUE
•
the market outlook"
may
be'
found in the prospects for a- con- •
tinued high level of overall * in- .
• -
approxi¬
ing
tied
are
no
prices have
again there seems no
down
overly
re¬
threads
seems
either
more encourag¬
reason arising from future attMbutes.
possibilities, to merit any change
In my judgment and
interpre¬
in a conservative market
policy. tation of the underlying
general
Now that stock
than
some
those
possessing
quality, relatively
ling
bearish
this year.
Mean¬
the
become
followers
marked
all
railroad
*
resistance
chart
When
together, there
weeks—
be found at around the
in
structure,
of
receding
Policy
Advocated
the
V*''
constructive
of
be witnessed at
area
in the similar 1949 period.
•Constructive Factors in Market:
The
pattern
meanwhile.
may
since
ages for the first half of 1952 will
..
;:.v
and
newxlow
a
moderate technical
a
may
256-260
earnings
the Dow-Jones Industrial Aver¬
•<
Outlook
to
averages—may portend an exten¬
sion of this intermediate decline
but
,
.*■
high
277.15
to
to
duplicated
bound
objective of effecting advantage¬
ous switches for
improved income
return.
and
although
the reduced
at
nection nevertheless that
recent
with
This
a
reacted
highs and lows in recent
historically substantial level. pqint
It.must be observed in this con-' level
adequately
time
deficits continue
recovered
less
Dow-Jones
August
declined
268.40.
still
standpoint.
should
be
re¬
holdings
273.17,
then
in
Conservative Market
"
per¬
the
on
The
A
area.
market
been
side.
280.29
could stabilize
yield
a
of
the
has
favorable
substantial up¬
Viewed in the other
budget
as
Technically,
./
lack of sufficient stim-.
more
the
forces
authority over credit and mone¬
tary policies.
Also, while on a
lower plateau, corporate earnings
of
decline in the general market. A
number of issues in this
category
appear
a
underlying
direction, however, some measure
of inflationary sentiment will
re-^
overT
of
for
ward -move.
con¬
be
not
resistance
priced
advanced
renewed
com¬
group for many months.
Still comparatively close to their
highs, the utilities have shown
now
has
a
on
favored
greater
market
visualize
the
rates,
the
uli
return
relatively stronger prospects
dividend continuity at estab¬
lished
while,
from the 175 level to the 270
formance
their
of
the
earning
determining common stock values.
Consequently, it is not difficult to
should
utility
and
corporate
frozen
However, the
ignored that in
increases
The
the
plane,
already declining.
are
of
are
higher
be
The
rate
power
income
siderations
influences
lower
is
"inflation"
the
cannot
factor
inflationary
be
may
economy
economy.
gauging
mon
it
the 'general
considerably
a
7
White, Weld & Co.
Company
The Commercial and
8
Financial Chronicle
1952
Thursday, September 25,
.. .
(1116)
More
"Regulation A"
Oiieiings and Small Business
Dealer-Broker Investment
Recommendations & Literature
Congressional intent to help small business would be emascu¬
lated by the adoption of SEC proposed revision of Regula/tion "A." Provisions regarding jurisdictions in which offering
—£ would be made make it possible for SEC to scuttle financing on
understood that the firms mentioned will he pleased
send interested parties the following literatures
It is
to
purely technical grounds. Measure would also
fundamental rights of certain minority interests.
stocks which appear interest¬
Pine Street, New York 5, N. Y.
Stocks—Bulletin—Laird, Bissell & Meeds, 120 Broadway,
&
We
policy—Sutro Bros.
in view of new rate
of Western Europe by Dr. Marcus
Bank, New York, N. Y.
Nadler—The
"State the
Processes—Illustrated booklet describing uses of
Products and
alloys, carbons, chemicals, gases and plastics (ask
let I)—Union Carbide and Carbon Corporation, 30
f
for book¬
East 42nd
Salle
South La
14 Wall
randa
South
Dempsey & Company, 135
—
La
Smith, Barney
—
Company—Analysis—Rothschild
Salle Street, Chicago 3, 111.
—
Hutton
E. F.
Illinois
Electric
&
Gas
& Co.,
&
& Company,
the
Co.—Analysis—G. A. Saxton
"7.
Machine
William
Company—Analysis
in which there
57
Street, New York 4, N. Y.
the
System—Memorandum—Auchincloss, Parker &
Redpath, 52 Wali Street, New York 5, N. Y.
Metals
&
Supply
York
Hoffman
Service—Circular—Hardy & Co., 30 Broad St.,
4, N. Y.
Radio—Circular—Ravmond
Boston 9,
Mass.
Also available is
a
&
Co..
148
State
memorandum
on
St^et.
Textiles,
Inc.
no
Kellogg
Company—Special report — Loewi & Co., 225 East
Mason Street, Milwaukee 2, Wis.
Also available are brief
analyses of Lake Superior District Power Company and The
Investment
Circular
—
—
330
Fifth
Avenue,
New
York
1,
N.
Hill
and
As
on
Central
Maine
Power
and
Service
of
Cement
Co.
we
that he has
notification
the
until
name
such
of the
An
Analysis and review of the Cement
Industry—Lerner & Co., 10 Post Office Square, Boston 9,
page
provisions in combination,
we
in
the
46
complied
inquiry
letter
up
to that point with all of the re- '
comes
in by mail from a State not listedf
of notification
Members: 1V.
74
Y.
Security Dealers Association
Trinity Place, New York 6, N. Y.
000,000.
That
The matter
potential
indicated by re¬
ports that inquiries for bonds, by
buyers
appears
the first day, were
the end of
in
$90,000,000, or better
than half the total involved.
of
excess
"Rights"
S. O. Indiana
for stock¬
With the books open
subscriptions to Standard
of Indiana's $139,647,200
of new convertible debentures, it
was natural
for brisk interest to
Oil
Co.
"rights" growing
the
in
develop
this operation.
out of
ready to take up whatever
stand
and certain sales literature:
being called to the attention of the SEC,
now reasons as follows:
These securities
come
purpose
of
tures and
seek this
who
vestors
the mail and, therefore, through the
listed in
letter of notification. This constitutes a violation of the
proposed regulation and, therefore, the issue is no longer
entitled to exemption. The Commission then proceeds to
notify the issuer and the underwriter that the exemption
no longer exists and the "offering" is smashed as a result.
never
have intended such a debacle,
yet that is exactly what could happen and, in our opinion,
Continued
on
investment
paper.
in
conjecture
But
of competition
investment
the keenest kind
circles points to
prevailing with in¬
for possession
stitutions vieing
page
28
of
"privileges."
Bonds Hard to Buy
brokers
Bond
their
bewailing
are
plight these days. They have
orders to
goodly smattering of
buy but their bids are
hold
not receiv¬
number pointed
As one of their
out,
3.10%
to
call for high-
good
has
he
grade corporates
a
those who
the securities.
a
all the way from
3% basis.
finds, institutions may be
new
issues which yield
above that figure, yet
let go of any
Meantime,
are
But, he
cool to
something
they won't
bonds.
it is observed, pen¬
sion funds and special
funds, like
finding it difficult to
keep their inflows
of money em¬
ployed.
offered through
Congress could
their way for the
acquiring the deben¬
moving them on to in¬
"rights"
Improved Undertone
medium of interstate commerce, in a State not
the
seemingly had their
they
fingers on the pulses of
trusts,
the Commission
were
$171,-
high for the entire issue of
ing much attention from
following:
Regulation A offering places an
in the New York "Times." Let us assume;
pertaining to the issue is mailed out to the inquirer in that
State. The inquiry itself may be "inspired" from a source
that is intent upon destroying the sale of the particular
Primary Market
Troster, Singer & Co.
municipal field, whose bids were
a
issue.
Westpan Hydrocarbon
investment
those in the
combined
a
read these two
Mass.
on
thinking of
bankers down through
these
jurisdictions?
quirements of the Securities Acts and of the Rules and
Regulations of the Commission thereunder.
New
—
Continued
of $15,750,000
best be
advertisement
Hampshire.
Riverside
can
The underwriter of
Y.
Public
of
envisage some such difficulty as the
Knowlton,
Puget Sound Power & Light—Review—Ira Haupt & Co., Ill
Broadway, New York 6, N. Y. Also available is a memoran¬
dum
letter
the
available.
can
—
in
mentioned
Calif.
Co.—Memorandum
with the bal¬
going to com¬
mercial banks, was reoffered to
yield from 1% on the shortest
maturity to 2.20% on the longest.
In
the
current operation the
yield on the short maturity is not
greatly changed, 1.05%. But in the
case
of the longest maturity it is
up
to 2.75%.
This reflects the
$118,038,000
down
ance
Undoubtedly sponsoring bankers
analyzed by considering, in connec¬
tion therewith, that provision of the proposed regulationst
which declares when the exemption from registration is
Company, Inc., 231 South La Salle Street, Chicago
Gamble
by the State authorities, such as New York,
Jersey, Delaware, Maryland, and the District of
This
Pacific Mutual Life Insurance Company of California—Analysis
—Hannaford & Talbot, 519 California Street, San Francisco 4,
&
the underwriter usually lists those States
formal registration requirements for
letter shall have been amended to state
Republic
The January flotation in
bankers took
investment
which
holder
are no
additional jurisdiction or
4, 111.
Procter
this was to have been ex¬
But
jurisdictions (stating territories, the Dis¬
or foreign countries) in which it is
Now, what will be the effect of the requirement that
securities shall be offered or sold in any jurisdiction
not
Torrington Company.
Nuclear Instrument & Chemical Corp.
name
Obviously, if the issuer and the underwriter were
compelled to register a $300,000 flotation in many of the
States of our Union, and comply with their Blue Sky Laws,
the cost of such registration would make the flotation of a
small issue prohibitive.
General Public
New
the broad
taken place in
the money market since the earlier
bundle of similar securities, carry¬
ing the Government's guarantee,
was brought out shortly after the
reflected
issues
changes that have
Columbia.
Co.—Analysis—Hill Richards &
South
621
name
issue
New
Spring Street, Los Angeles 14, Calif. Also
available is analysis of Kaiser Steel Corporation.
Co.,
List the
In response,
Co.,
DePasquale
—
Columbia Gas
Ducommon
offered to
proposed to sell these securities."
Republic
yield bases on the cur¬
True the
rent
trict of Columbia
Company, 209 South La Salle Street, Chicago 3, 111.
Clinton
so
The present Form S-3b-l does contain, among others,
following requirement:
Company, 61
Company—-Analysis—Central
Light
the securities to be
of the additional jurisdiction or
jurisdictions." (Italics ours.)
't. :
Co., Inc., 70 Pine Street, New York 5, N. Y. Also available
is a card memorandum on Central Electric & Gas Company.
Illinois
to
as
stating the
&
Central
a
exchange. No securities shall he offered or sold
in any jurisdiction not mentioned until an amend¬
ment to this letter of notification has been filed
Broadway, New York 6, N. Y.
Central
(States, Terri¬
the
Street, Chicago 3, 111.
Aviation—Analysis
of the jurisdictions
names
by this letter of notification. If all or any part
offering is to be made by use of the facilities
national securities exchange, it will be suffi¬
cient
Also available are memo¬
Boeing Airplane Co. and Southern Production Co.
Howell
Bendix
of
r
,
Street, New York 5, N. Y.
on
&
135
t
Aircraft Corp.—Memorandum
Beech
Bell
ft
$
Corporation—Analysis
Admiral
Commission,
of the
Street, New York 17, N. Y.
*
the
form,
tories, District of Columbia and foreign countries)
in which it is proposed to offer the securities covered
•*
such
with
other provisions, proposes the following:
among
Growth—Bulletin—Cohu
N. Y.
Co., 1 Wall Street, New York
connection
In
was
score
pected.
...
currently used for the letter of notification
SEC, under Regulation A, is known as Form S-3b-l.
to the
^
anxiety on this particular
hardly necessary.
recent
evaluation of this "Proposed
our
The form
120 Broadway, New Ycrk 5, N. Y.
that much of the
turn of the year.
continue
now
Revision."
1, Ont., Canada.
Portfolio for Income and Long-Term
in passing the original legislation,
Regulation A seeks to operate, was to help
small business.
Canada—Bulletin—Ross, Knowles & Co., 330
Gas Outlook—Analysis
discussed, in part, Release
Exchange Commission, en¬
of the Congress
tion
under which
Chemonomics—Newsletter on the financial, commercial and
technical aspects of the chemical process industries—R. S.
Aries & Associates, 400 Madison Avenue, New York 17, N. Y.
Bay Street, Toronto
we
which fol¬
events
of
course
lowed it appears
Proposed Revision of Regulation A."
As we indicated, this Regulation has to do with the
flotation of small issues of $300,000 or less, and the inten¬
Ltd., 355
Corporation, 100 Broadway, New
Fall Outlook for
editorial,
recent
a
No. 3450 of the Securities and
Companies—Analysis of outlook—The first
York 5, N. Y.
Casualty Insurance
Hanover
the
once
issue was
and from
postponed, housing bond
put up for bids this week
titled "Notice of
Thomson and Company,
Street, West, Montreal, Que., Canada.
Canada—Booklet—Nesbitt,
St. James
In
1952
I. duPont & Co.,
highs and of 20 near 1952 lows—Francis
1 Wail Street, New York*5, N. Y.
Impressions
curb
and
long-awaited,
The
pro¬
Spectrum—List of 20 stocks selling near
Both Ends of the
& Co.,
Latest
5, N. Y.
New York
Boston
circumscribe
posal of Commission reemph&sizes need for Congressional
on SEC rule-making power.
Appreciation Potential—List of
ing—Stanley Heller & Co., 30
Bank
on
The
a
week.
in
new
a
issue market displayed
improved undertone this
much
Investors
more
appeared to
contrast with some
recent opera¬
tions which exhausted the
of
their
sponsors,
Koflnt*
oltn
patience
latest new of¬
ferings seemed to be
wvunK
be
receptive mood, and in
moving out
Volume 176
Number 5154
The Commercial and Financial
Chronicle
...
(1117)
\
(1) an increase in the tax base, hasten to
buy if they think prices
i.e., in personal incomes, and (2) are
going still higher. The slight
an increase in tax rates. The for¬
recession in prices in the past
year
mer is represented
by personal in¬ has probably helped to account for
comes,
which are likely to in¬ what decline in
consumption ex¬
crease;
tax rates will probably penditures
took
place,
but
as
remain constant during the com¬
prices are again turning upward, it
ing year. Total tax payments may will be a
reinforcing factor in'the
rise somewhat more than at the
upswing of consumption expen¬
same percentage
as personal in¬
ditures, measured both in terms of
The Business Outlook
By MARSHALL D. KETCHUM*
Associate Professor of Finance, School of
Business
University of Chicago
On basis of gross national
Professor Ketchum tempers
and tired"
quate
product analysis and projection,
optimism over continuation of "old
postwar boom. Asserts Government possesses ade¬
surmounting prpblems arising from pro¬
ance, or the outflow
goods
tive,
the
of
in
be
and
sonal
body:
per¬
figures
by
order
c a n
in
s e e
We
primarily
necessary to consider the data
consumption expendi¬
1951
on
to
low
a
annual
an
of
$204.5
basis
rate
throughout the
a
physical unit basis, and
changes in the price level at
services
valued.
The gross national product rep¬
find
sumers
income
taken out of this
are
before
they
can
start
spending. The amounts taken out
production
of goods
bought by
different groups and for different are primarily taxes. The data show
purposes. We cannot make a fore¬ that personal income has been ris¬
cast
of
gross
national product ing throughout 1951 and the first
and services which
without
breaking down
into
ure
are
this fig¬
its components and not¬
ing the factors that
are
affect each component.
four ^principal
likely to
There
are
The
components.
increased
mained
expenditures for durable goods,
for non-durable
goods, and for
services.
Second
is
gross
investment,
which
sents
expenditures,
by
repre¬
business
firms and by individuals, for goods
of a capital nature, goods which
not consumed
which
are
sumer
used
immediately but
to
produce con¬
later on or which
goods
have not yet gone into the chan¬
nels of trade to the point of sale
of
the
during the early
period
stable
for
has
and
the
re¬
three
past
will hold
come,
well and will
up
later. It does not
policy
strikes at such
fall, and the
inflationary
th4
plus
explained
in the cards
seem
that wage rates shall
government
by the gov¬
be
a
desire
wage
to
avoid
critical time will
by
manu¬
$266.0
commercial
enter¬
facturers
i.e.,
installed
and
cause
rates
wage
period.
The
rise
to
during
combination
high employment and rising
will
increase
billion
the
during
of
wage
levels
June,
of
al¬
though it fell to $264.0 billion in
July because of the steel strike.
ventories in the hands of business
I
firms.
billion
resent either
increase
an
rep¬
de¬
or a
The third item in gross national
product is net foreign investment.
It represents the net foreign bal¬
*A
at
bv
paDer
presented
by
Mr.
Ketchum
the F'^hth National Conference offered
the School of Business of the Univer-
*;tv
of
Oicairo
in
cooperation
National
Restaurant
IS,
and
1952
at
of
the
of
the School of
Retail
the
Food
with
Association.
the
Sept.
Second
C«"»ference
Distribution Program
Business
of
the Univer¬
sity of Chicago in cooperation with the
National Association of Retail Grocers.
expect
a
figure
total
of
of
private
themselves over-in¬
inventories
in
in
view
buying
overbuying
the
immediately after Korea.
cline
in
all
three
served to decrease
invest¬
personal
$265
income
To arrive at the true
spend, however,
tax
payments
we
from
ability to
must deduct
personal
in¬
This deduction gives us the
of personal
disposable in¬
come, the income which income
receivers can dispose of by spend¬
come.
level
ing
it
or
will
by saving. Tax payments,
be
noted, rose slowly
throughout the first six quarters
in
the
cause
table.
Two factors may
increases in tax payments:
of
consumer
followed
The de¬
components
investment
new
tures
deducted
are
from
dispos¬
able personal income. The extent
to
which people
will
noted that this
declined
quarter
the
of
later
the
most
heavy wave of anticipatory buy¬
ing which left consumers well
a
stocked
1951
up
new
durable
consumer goods. In
pendulum swung in the
direction.
their
People
inventories.
became
As
This
advertisement
an
-
is
not,
and
of personal
saving
rapidly throughout 1951.
any
seem to
noted that the
and
It will be
liquidation of busi¬
inventories
ness
the level
on
of domestic investment.
industrial
of
commercial
enterprises
Continued
on
(non-
page
1951.
Stocks
of
of such securities.
time
at the
up
that
are
a
circumstances
to
be
construed
as,
solicitation of an offer to buy
The offering is made only by the Prospectus.
Duquesne Light Company
First
Mortgage Bonds, Series due September 1, 1982
consumers
incomes
no
$14,000,000
consumer
goods in the hands of
gradually being used
under
indicate
near future to go back to the ab¬
normally high levels prevailing in
and
in increasing
this oc¬
When
NEW ISSUE
that the percentage of
disposable
incomes saved is unlikely in the
same
inventories.
pansionary influence
offer of these securities for sale or
Recent declines in personal
saving
increases in consumption ex¬
penditures would
is
higher personal
burning still deeper
(31/4%)
Dated September 1, 1952
Due September 1, 1982
larger holes in the pockets of
consumers.
if
prices
downtrend
again,
and
they
as
dences of
From
start
show
first
102.422% AND ACCRUED INTEREST
upward
some
evi¬
doing.
the
OFFERING PRICE
their
reverse
Copies of the Prospectus
undersigned and
quarter of
others
be obtained in any State only
may
as
may
lawfully
offer these
from
securities
in
such
of the
such
State.
1951
Kuhn, Loeb & Co.
Union Securities Corporation A. C. Aliyn and Company
Incorporated
September 24,
1952.
>
of personal
consumption expend¬
Durable goods sales de¬
while
sales
of
non-dur¬
started upward again.
there
are
toward
While
This
longer the pressures
purchase of durable
goods that existed in
no
consumer
advertisement
an
the
is
not,
and
is under
no
offer of these securities for sale or
any of such securities.
a
circumstances
to
be
solicitation of
an
offer to buy
construed
The offering is made only by the Prospectus.
as,
,
'
the
immediate postwar
years, we
need to remember that
every in¬
crease in
incomes makes it pos¬
sible for some income
groups to
purchase durable consumer goods
formerly beyond their
means, at the same time that rapid
technological changes are bring¬
ing into the market new types of
NEW ISSUE
$7,500,000
were
durables
to
tempt
consumers.
Consumer credit is currently un¬
dergoing
this, too,
rapid
a
will
expansion
Pacific Power &
First Mortgage Bonds,
Light Company
3%% Series due September 1,1982
Dated September 1, 1952
Due September 1, 1982
and
probably increase
sales of durables.
A possible unfavorable factor in
the expansion of consumption ex¬
penditures in terms of physical
units
is
the
existence
of
high
prices and the possibility of still
higher prices.
High prices take
out
of
would
the
markets
purchase
if
some
prices
OFFERING PRICE
101.814% AND ACCRUED INTEREST
Copies of the Prospectus may be obtained from
in
any
State
where
who
the
undersigned
may
the undersigned by persons
lawfully offer these securities.
were
lower.
However, it must be re¬
membered that the effects of high
prices
may
consumer
noted
two
that
ways.
Kuhn, Loeb & Co.
be offset by increased
incomes.
Also it may be
rising prices work in
Consumers hesitate to
buy at high prices, but they
may
September 24,
1952.
or
the additional investment in
inventories will again have an ex¬
construction, producers'
equipment,
and
the
and
are
sooner
result
a
amounts
went up
late
place will
with
the
the
into
take
curs,
understand
implications of this fact for
save
was
up
work
their
;difficult
sentiment. After Korea there
longer building
again feel justified
billion, on
basis, since the first
To
no
inventories down to
the point where businessmen will
is one the fhture, however, it is neces¬
things* to sary to study the components of
forecast, primarily because it is so private investment. As the table
dependent on psychology and is so shows, this component of gross na¬
susceptible to very rapid shifts of tional product can be subdivided
of
were
stocks of goods for
sale, but it also
means that new increases in sales
of Investment
1951.
bei
wholly because
businessmen did not add to their
inventories. This means that busi¬
nesses
by $10.5
annual rate
was
about
for the year.
in inventories.
crease
has
which
prises, and thirdly, changes in in¬
This latter figure can
which
The total volume of investment
an
expendi¬
and
will
as
machinery
equipment,
fixtures
in
decline
which
Decline in Volume
consumption
of goods and services
ernment,
personal income. It is noteworthy
that personal income is estimated
to have been
running at a rate of
able
fell
ables increased. The sales of dur¬
ables may have turned the corner
rates
ments, secondly of producers' dur¬
vested
low in time of
depression. For example, invest¬
ment fell from over $15 billion in
1929 to less than $1 billion in 1932.
saving, which is the residual after
ployment will remain high, par¬
tially because of large purchases
trial
establish¬
found
nesses
It should be
new
pro¬
equipment
while the additions to
business inventories were decreas¬
ing
significantly because busi¬
figures represent
the dollar amount of
personal
through the first quarter of 1952
opinion that the ability there was a divergence between
sales
of
of consumers to spend, insofar as the
durable and non¬
this is measured by personal in¬ durable goods within the category
the form of residences and indus¬
and
spend. Willingness to spend is re¬
flected^ the amount of personal
It is my
the
commercial
the
durable
during
In late
and
quarters.
to consumers.
Gross private do¬
mestic investment consists first of
the construction of buildings in
and
ing personal consumption expen¬
ditures, after ability to spend has
been disposed of, is
willingness to
probably increase slightly during itures.
private the coming year. Levels of em¬ creased
direct
are
a
increasing, disposable personal in¬
come
penditures,
to
at
that
construction
slightly,
physical
gross
new
ducers'
of boom and very
tuated
part
the table
personal consumption
expenditures are broken down in¬
Willingness to Spend
The second factor in determin¬
although tax payments have been
although
1952,
,
to
domestic investment.
A
tendency towards
decreasing savings will be accen¬
of
period under survey.
1951
ponent of gross national product.
It tends to be very high in
periods
diminished rate in 1952, and that,
half
first is personal consumption ex¬
which is what con¬
sumers spend for goods and serv¬
ices for consumption purposes. In
.
the
the
now
under¬
gone certain cross-currents
*
come
noted
of
inventories.
have
may
billion for 1951.
less fearful that there would be an
all-out war and consumers used
The
1952.
terms
business
ment, investment added to that al¬ from $59.3 billion in the first
$265 billion of ready in
existence, and that the quarter of 1951 to $52.9 billion in
personal income, would give $232
figures do not include deductions the fourth quarter. During the first
billion of disposable personal in¬
for
depreciation.
Investment is half of 1952 domestic investment
come for 1952,
compared with $225
ordinarily the most volatile com¬ declined further, but it
other
so far
expenditures of
consumers are influenced by two
factors, the ability to buy and the
willingness to buy. The data on
disposition
of personal
income
which are given on the same sheet
with the gross national product
data are useful in evaluating both
of these factors.
The ability to
spend
is
determined
by
the
amount of income paid to persons,
and by
the amounts that con¬
on
the
are
in
and
in
subdivisions
deducted from the
into
in the
production;of goods and services
and
expect tax payments to be about
$33 billion for the year, which,
remainder of the year and
factors." changes
goods
of
billion
measure of the level of
business activity. Changes in the
total of gross national product re¬
resents
what factors
see
and then increased
It is the most all-
these
by some¬
for per¬
consumers
Consumers' Expenditures
ter
inclusive
which
We
of
our
a much greater bite
personal incomes. I would
of
can
tures declined in the second quar¬
important trends.
ices produced.
to
Personal
on
The gross national product rep¬
resents the yalue, at current mar¬
ket prices, of all goods and serv¬
are
bought
are
(1) by
detail
-
quarterly basis. To consider only
the totals for the year 1951, for
example, would fail to disclose
two
it
year.
a
flect
classification
working to change each of them
with the short-run, let us say, for
the next year, and therefore it is
some
this
and how these factors are likely
quarter to the to affect the
totals during the next
one
concerned
are
and
down
We shall consider each of these
Marshall D. Ketchum
the trend from
next.
goods
broken
ment.
that
we
is
capital investment; (3) by for¬
eigners, and* (4) by the govern¬
quarters, at
annual rates,'
in
goods are
is gov¬
for
have been set
down
ex¬
sonal consumption purposes; (2)
by individuals and business firms
income.
The
nega¬
out
that all goods and services
seen
produced
expendi¬
ture
units.
of
Federal, and State and local.
From
na¬
tional product
It
item
which
larly the data
or
of
fourth
purchases of
into
or
whether
on
services,
the
gross
The
period.
positive
imports
or
inflow of
or
ernment
particu¬
on
either
larger.
relevant vari¬
past,
tax
Still, taxes will prob¬
structure.
particular
a
depending
ports
the
ables
in
be
can
happen-
to
dollars
nature
ably not take
An analysis of the
current busi¬
situation and a forecast of
the future
requires that we take
a look at what
has been
ness
levels
because
the
progressive
spective slowing down of defense expenditures.
ing
however,
comes,
machinery for
change
These
9
3S
The Commercial and Financial
Chronicle
Thursday, September 25, 1952
We started with a title—"Chemicals—A Symphony of Synthetics."
ings should have the higher mul-
Chemicals-A Symphony
Oi
In
COBLEIGII
By IRA U.
"Expanding Your
titled "Climbing
1952,
10,
Income"
impressive companies in this field
chemical reaction in the market might be reversed.
where recent
1952,
30,
June
On
the back, Union Carbide
among
were
groups
-
-
oil, natural gas
in the
chemicals
and
it
might have
appeared,
voted
slippages in
in¬
that
list,
Ira
i c(# for
glamor and
growth the solid
p r
U. Cobleigh
could make sweet financial music.
price range.
Notes
NSTA
his sincere apprecia¬
Keefe for the use
AD LIBBING
Mr.
to
This
of the data prepared
some
& Co.
week
we
are
appropriate credit
R. L. Day
at the time of publica¬
As
UK are suggest¬
mention
members
who have
possibilities.
Sid Saunders of Foster & Marshall, Seattle,
Mr.
faet,
of
matter
a
and Guy W.
Cobleigh feels that Mr. Keefe's
monograph
"Banking"
is
must-reading for students of
bank shares and investors in
holding.
to
Cleary of Florida Securities Company, St. Petersburg, sent in a
commercial ad and has suggested three other
tion.
exclusively to this industry,
Carbide as its largest
anxious
outstanding in producing ads for our Convention issue of the
COMMERCIAL AND FINANCIAL CHRONICLE. George M. Mcbeen
the
Prosser of Merrill Lynch, Pierce,
Cleveland, are also mentioned
Fenner & Beane,
for real
performance.
I hope we can continue
give our members the names of those who
giving your Advertising Committee assist¬
ance needed to go over the top.
I impress upon those who are interested
to
are
same.
that
chemical production by coal hydrogenation, and this technique ecj
statistics of the
industry suggest only a lull in
long-term forward motion.
Some 1 500 000 acres used to be
devoted to raising indigo for dyes;
now
these coloring agents
are
chemically produced.
Orion, dy-
patience,
and
"Bank¬
due Mr. Keefe and
between
Coal and
on coal
chemistry. UK has already spent
$n million on a pilot plant for
high
ing too
discussed,
shares
luck
Banks," July
omission of
by the recent liaison
Pittsburgh Consolidation
Union Carbide to work
had been pay¬
these
little
of the more
factual material
by him, and his regret for
ed
here
vestors
of
Union
New vistas for
of
a
Hartford, Conn., Mr.
Ira U. Cobleigh, author, of the
"Chronicle" article, wishes to
world, manufacturing seven
market
chemical
the
with
unlikely item
Street,
-
express
lists
most
some
monograph
tion
recent
from
leads the list,
It is also mak¬
contributions to the
atomic energy program through
design and operation of plants for
the
government.
It is of some
significance,
I think, that the
July 15 report of Chemical Fund,
Inc., largest investment trust de¬
four
were chemi¬
cals. Although
the
not
in its
written by Harry V.
Keefe, Jr., Resident Partner
of R. L. Day & Co., 75 Pearl
ing important
vorites,
Rayonier, Inc. at present lev- some
is
ing,"
of the nine types.
(in that or¬
der), and of
the 20 top fa¬
els
We may not have followed same
wild with optimism. Let's just too faithfully, but, quite possibly,
derived from a most ex¬
cellent
An impressive company grossing
$927 millions in 1951, UK is the
largest single producer of plastics
fifty stocks most widely held by
investment trusts the three leading
was
comment on some
run
say
"Chronicle" article, en¬
a
important
^Current
tiplier of a chemical—say 12 times,
12 x $5 = $60. Come now, let's not
Qrateful
Acknowledgement
Synthetics
Author of
a
...
(1118)
10
the
yellow contract forms are
used for
commercial ads and the orange colored forms
are for broker-dealer ads. Also, in talking with
jt seems ever to be moving
Russ Hastings, S. R. Livingstone, Crouse & Co.,
ahead at a prodigious pace. This
year's advance is found in the
Detroit, our National President, the basis used
for affiliate participation is the same as here¬
new $50 million plant near New
tofore—1949 and not 1951 basis as stated in
Orleans to make petro chemicals;
Harold B. Smith
and jn its new metal extraction
my recent letter to the membership.
Our gross to date is $19,567, with New
nel dacron and vicara have wool
process. Refining and smelting for
sort of taking it "on the lam" and
years have been standard proceYcrk City over $8,061. Let us all get behind this project during
plastics have been displacing wood
dure for extracting cobalt and the period the phones don't ring on trades and you will surprise
and metal and other elements in
nickel from ores. Now this can yourselves as advertising salesmen.
such diverse fields as boat hulls
be done with chemicals, and CyHAROLD B. SMITH, Chairman
and bottles, pipes and pans, floor
anamid is developing plants in
NSTA Advertising Committee
covering and furniture parts, bilconjunction with Howe Sound Co.
Pershing & Co.
liard bails and teeth fillings.
Commercial Solvents is a dura- (Utah) and the fabulous Sherritt
120 Broadway, New York 5, N. Y.
On the growth side, historically, ble enterprise, increasing the di- Gordon Mines, Ltd. (Alberta),
FROM THE CONVENTION COMMITTEE
from 1925 to 1950 the general an- versity of its products, and beFor 1951, gross grew $76 million
nual average
increase in U. S. coming less importantly depen- 0ver the preceding year to $401,All members planning to attend the NSTA Convention are
industrial
production was 2.9% dent on alcohol output. $2.22 was 802,275 and net was $34.8 million,
urged to send in their registrations to John Bunn, Stifel, Nicolaus
while the chemical industry led earned on the 2,636,878 shares in 100% stock dividend in July this
& Co., Incorporated, 314 North Broadway, St. Louis 2, Mo., at unce
all others with a 9.8%>. increase. 1951.
Less earning power is ex- ygar pleased'the shareholders and
to assure accommodations at the Roney Plaza.
Late reservations
For 1951 chemicals received the pected this year, but the first 1952 brought a lot, of new trading acmay have to be accommodated at a neighboring hotel.
third largest allotment to indus- quarter looks like the low point tivity.
Recently at 54 (against
Roney Plaza rates are $12 per day, two in twin bedroom, and
try of rapid amortization certifi- in profitability and no one seems 653^ equivalent high for stock beten dollars per day single room, European plan. Please help your
cates; and the 1952 McGraw Hill to think the 250 quarterly divi- f0re split) and indicating a $2
committee and do it now.
projection for capital expenditure dend is in danger.
dividend, ACY yields about 3.80%.
here was $1,464 million ($200 milCV now turns out over, 200 When chemicals advance, ACY
SECURITY TRADERS ASSOCIATION OF NEW YORK
lion above last year).
It stands products, with industrial chemi- usually joins in; and often it has
to reason that the managers of cals such as ethyl,
alcohol and ied the parade,
Security Traders Association of New York (STANY) Bowling
chemical enterprises, whose judg- derivatives, nitric acid
and dry
Five thousand products, from
League standing as of Sept. 18, 1952 is as follows:
ment has proved so sagacious in ice accounting for 35%
of 1951 standard chemicals to those for
TEAM
Points
the past, would not now be spend- sales, 15% in farm chemicals and synthetic rubber and plastics, a
Donacuo (Capt.), Demaye, Whiting, O'Connor, Rappa, Seljas
10
ing all this new money, unless pesticides, 14% in pharmaceuticals marvelous drug and anti-biotic
Krisam (Capt.), Ghegan, Jacobs, Gannon, Cohen, Strauss____
10
they expected unabated growth, (penicillin and bacitrain), 16% in iine, dyes, insecticides and exploSerlen (Capt.), Gersten, Krumholz, Rogers, Gold, Young_^_
9
and high-level profitability.
car anti-freezes and washes, and sives—all these are building sales,
Murphy (Capt.), Manson, D. Montanye, O'Mara, Pollack,
Today, no fine-tooth coverage 10% in spirits, neutral as well as and a by no means dull future '
Gavin
9
of any company will be attempt- the more aggressive kind!
for ACY.
Goodman (Capt.), Smith, Valentine, Meyer, Farrell, Brown
8
•ed; rather it is proposed to set
Since 1939, dividends have been
My
last item
for today is : Leone
(Capt.), Greenberg, Tisch, Werkmeister, Leinhard,
down
cial
current
some
five
about
declared in each year. CV at 20
against 35/8, the years
high, may suggest to you that
lab-lead-
It's really a chemi-
Ray0njer Inc.
horizons— today,
six
or
since by chemical processes
engaged in producing purified
chemical cellulose from wood pulp. This
base material, wood cellulose, is
Mathieson has expanded faster clamored for in such products as
are three chemicals found
than any other chemical but it's rayon,
acetate,
cellophane,
all
imposing facade of the done it differently—by merging. SOrts of paper, plastics, tire cords
companies
ing
items—finan-
production
and
notes
important competicor to petro chemical processes.
These footnotes about UK give
no idea at all of the vast scope of
;his property and its kindness to
jhareholders through the years,
Get a good statistical summary of
JK, and you may well discern the
quality and value of this common
at 63V2 and the call it gives on
the future of the plastic age.
may prove an
shares,
whose
at there^ has^ been sufficient
present price levels, do not seem
reaction in this issue.
overly inflated.
There
in
the
Dow
-
like
I'd
Averages.
Industrial
Jones
touch
to
upon
1947 this company, under
In
of dynamic leadership of Thomas S.
two
acknowledged
the
is
Rayonier
r
so
little redundant. Its buying, in toto, Mathieson Hydrobalance sheets through the years carbon through an offer of its own
have
a
looked
like
custom
tailored
in
shares
exchange.
And
now
with
products of the Credit Men's As-
there is in progress
sociation.
96-year old Squibb—five Squibb's
'
-
a merger
forQ three
Mathieson's.
Allied
has found that, due im- Squibb adds anti-biotics, vitamins,
portantly to taxes,
it can no toilet goods and pharmaceuticals
longer expand plant capacity from to the Mathieson sales arsenal.
,
Like
other chemicals, however,
retained
to
piece
earnings
alone.
•
A
common
As
$50
Mathieson
past
goes
out" theaSS7b6eemiir1onan,Q« ST™ "if0" ma« fa
out the $75 million .1952 column, it now offers
Incidentally, diversity
expansion program.
of industrial
a
and
the
broad
farm
thisthreyear relief and provide chemicals and fine entrance into
loanhelps would the health trade—a big forward
E. P. T.
some
to
the early days when
earn
it lived almost exclusively on the
8,856,000 shares (sole capitaliza- alkaline side!
%
tion, except for the loan) before
Mathieson
with satQaan
getting hit with an excess profit mon shares
seem
tax
permit ACD common to
nearly $3.50 a share on its
bite.
some
Because
I61/4
earnings,
Tom Greenberg
times
ACD
at
projected
75
is
1952
umllhtTu^it^a
sweep from
Souibb
JL
M/itu
o
™
but it's pretty tough to meXt worth
a rounded chemical port- market
is
folio without finding ACD aboard, torn
year's
bargain;
Imagine
trust
chemi,
while
to
_
.
'
...
.
,
,
.
Hank Serlen
Krisam
THE BOND CLUB OF DENVER
The
American
?
hiX
Cyanamid
,
Bond
Club of
Denver-I. B. A. party which was
reserves, owning or
as
controlling at
llltl
the Northwes; ai^ 375 000 acres
as.t* J
^7°^' to cuT alrnost a bm^n
feft J lumber
35 000 acre
Indian Reservation in Washington,
Ravnnipr'<?
hp^t
rnstomprs
in0n
cludey DuPont
ous
American
follows:
Low
Fort
tomers
T;'
is
Sullivan & Co.,
exactly
...
,
dvinff
„
on
the
.
I£ you h!fe leverage, Rayonier,
•
Tl
?£?
^
? ,ea™n(SS in
S 1952- Thus> lt sells below 7 times
hoped-forwas right atBut if start,
earnings.
our
premise
the
continues namely that Ravonier is a chemifascinate the chemically mind- cal, then it might seem these earn-
Baker, Hamilton Management Corporation,
134.
2nd Team Low Net: Elmer
Longwell, Boettcher and Company
Ormsbee, Peters, Writer & Christensen, Inc., 135.
Softball: Again
ens
18 exactly dymg °n ttle
Bob
(Third successive year.)
2nd Low Gross: Dave Lawrence, Boettcher and Company, 77.
Low Net: Sam Dunham, Earl M. Scanlan & Co., 59.
2nd Low Net: Fred Meyer, 6L *
.
Team Low Net: Fred Meyer and Arthur Bosworth, Bosworth,
Viscose
Nonp of thpsp
Gross:
Collins, 71.
and Jack
Hnstrial Ravnn
Longwell of Boettcher and Co. tied with net 65's for the
Other prizes were awarded
and Elmer
a
current
and
Annual
Aug. 21 and Aug. 22 reports the following results of vari¬
activities: Golf—Leon Lascor of J. K. Mullen Investment Co.
on
Arthur H. Bosworth Memorial Trophy.
r
here-
held
Rayonier did not really begin
rev up ^ Postwar when it
be&an to latch on to vital timber
to
ouT andinl' aftefthe
has11.$40 milli°n
Jebt;
mLeer qpllf prnnnH d9 $23Vz milll0n m Preferred ahead
^m l-.araurixd J2 of its 1.987,742 common shares. At
SJ?<J^ a-j0UI7i °*
1,987,742
you
Of the investment
200
Wilbur
nf
praise gets
4
5-Point Club
200 Club
,n,i
fhemieni
Allien
ic
Huffl
(Capt.), G. Montanye, Voccoli, Siegel, Reid,, McGovern
Hunter (Capt.), Klein, Weissman, Sullivan, Murphy, Searight
Meyer (Capt.), Kaiser, Swenson, Frankel, Wechsler, Barker
Lytle (Capt.), Growney, Craig, Fredericks, Bies, Lyons
Bein (Capt.), Frankel, Casper, Nieman, Bass, Krassowich
Burian
the an(j fabrics
1Ch° S' clf lr™a"-Pres;dent, took lead/r in this £ield prodUcing 60%
nl Jn ' ®
ihit w
two leading fertilizer com- f th dissolving pulp output of
Sin III W,™ the? pamen into organic Math'eson the United States, and about 20%
been
good for so long, that moved • Ltast y„ear-'
chemicals by
wnrid tn+ai
Fi/ct
8
7
7
6
6
6
Lopato
Mewing (Capt.), Bradley, Weseman, Hunt, Gronick,
by Jack Ralston, Peters, Writer &
year
•
*
the Over-the-Counters, piloted for the second
Christensen, really poured
winnihg by a teriffic score.
J. A. Hogle & Co., came through finally
and won this event, beating out Phil Clark, Amos C. Sudler & Co.,
by a narrow margin. Vic Zahner. Zahner & Co., and Russ Siefert
of Stern Bros. & Co., Kansas City, were finally stopped cold and
did not even place, the first time in many a party.
it
on
the Stock Exchanges,
Tennis: Larry Inman,
Horseshoes: We had
a
real dark horse in this one, Bob Kirch-
Carroll, Kirchner & Jaquith. Inc., came through to the great
surprise of himself and everybody else.
ner,
Putting:
The competition in this event was very heavy and
Continued
on
page
47
Volume 176
Number 5154
..
The Commercial and Financial
Chronicle
.
(1119)
Nature
hand of
Geologists tell
tains
rose
were
moun¬
great masses of
buried under
plant and
layers of earth,
water.
Then there
actions transformed that buried
re¬
into
matter
oil and natural
gas.
are
today's plastics. Some
many
of
into its
us.
own
US—Natural
within the lifetime of
Its great importance began when
scientists learned
to
separate
and
use
its parts.
Out of this work in the field of
petro-chemistry
cameuPrestone"anti-freeze,the all-winter type
that took the
worry out
ago
of cold weather driving.
Others
are
used
liners.
•
protect
gas
the bottoms of
products
•
more
for
ocean
important
are
you turn,
FREE:
...
man-made fibers that
textiles
new
chemicals... and also
ern
bottled gas
..
.
go
into
L earn
to use in
making the things that
well.
about the
interesting things
day. Write for the illustrated book¬
more
let "Products and Processes" which
tells how
there's something that's been made
science and
industry use the Alloys, Carbons,
Chemicals, Gases, and Plastics made by
Union Carbide. Ask
for booklet /.
by the magic touch of chemistry. It
brings you many of today's life-saving wonder
drugs
you so
you use every
FUEL—Wherever
better
exciting
than 350 of these versatile chemicals
industry
-serve
ingredients in nearly all of them.
your
Union Carbide
hundreds of useful
"Pyrofax"gas, the mod¬
AND
for home, farm, and industry.
30
east
CARBON" CORPORATION
42nd
street
hh3
of Alloys, Carbons, Chemicals, Gases, and Plastics include
Eveready Flashlights and Batteries
electromet Alloys and Metals
Dynel Textile Fibers
people of Union
pioneered in producing synthetic or¬
ganic chemicals. Today, their plants turn out
Carbide
tough and enduring that they
so
to
Natural
UCC's Trade-marked Products
Prestone and Trek Anp-Freezes
UCC AND CHEMISTRY—The
so
pliable that they make beautiful, longlasting curtains and drapes for your home.
FROM ANTI-FREEZE TO
IT IS IMPORTANT TO ALL OT
are
soft and
are
long periods of time, chemical
gas came
billion years
a
Age-old natural gas—changed beyond recognition by the
science—is in
nearly everything that's new today
that centuries ago
us
disappeared...and
Over
working for you...
and crumbled...oceans formed and
animal life
rock, and
was
•
•
National Carbons
haynes stell1te
Bakelite, Krene, and Vinylite Plastics
•
Alloys
•
•
acheson Electrodes
•
new
—
pyrofax Gas
presto-lite Acetylene
Linde Oxygen
•
Synthetic Organic Chemicals
.
york
17,
n.
y.
11
The Commercial and
Financial Chronicle... Thursday, September 25, 1952
(1120)
32
Socialized Medicine and
Its Failure in Britain
By RT. HON.
of the
be safe and
they
first
the
clearly
social
the
out
and
economic
of which the present
pattern
has
leader of the nations
become the
"who
devoted
are
to
been allotted
of the
secure."
to
free
a
democratic way of life
and
.
na¬
.
the dignity of
tions which respect
man."
pointed out that it was
He then
alone—phys¬
ical power—that this challenge to
leadership must be accepted, but
also by working "through men's
no
longer by power
and
minds
imagination."
Coming, next, to the sphere in
which his hearers were
specially
concerned, the Senator
that America had kept
affirmed
free the
science
of
fields
and,
the
as
American
and
medicine
so doing,
had made a
result of
medicine
big contribution to its foreign re¬
lations. This he illustrated by ref¬
zation
Health
of
to a grave economic emer¬
They waste little time de¬
fining the National Health Service
Act as a great achievement in so¬
cial advancement but instead most
sponse
and
disillusionment
i.
There
a very
is
almost
may
universal
Sreement
revolutionarv
the
historic "Point IV."
how
member
we
the
have
it ran:
Truman's
You re¬
that
"Now
medical knowledge
method
bv
which Uie Act was put into oper-
It is remembered tLt the
BeveridgeVfan flowed taml
rtion
1ft
tn
vears
to arromnlish bv erad-
to the work of the Eco¬ that can bring good health within
uai stages what was done at midual stages wiuu
uone at imu
Cooperation Administration our reach to a degree heretofore
rnght on a certain date as an act
and the World Health Organiza¬ undreamed of, we must improve
of power.
There is little symtion, which he considered to be the means for putting that knowl¬
nathv for that
oart of the Act
"one of-mankind's most stupen¬
1
IU
u
1
e,. ;
edge to practical use . . .; to see
dous efforts
to put into prac¬ that our people actually enjoy
the
the
tice the ideals of brotherhood and the
good health that medical sci¬
governmem ana nas led :to
faith in the fundamental goodness ence knows how to provide is one government and has iea ,10 rne
deterioration of general practice,
of human beings."
of the great challenges to democ¬ This
thpv
This, they hplipvp was not nec
believe, was not npcSenator
Kefauver's next sen¬ racy."
essary.'
tence must have given you much
savs
Dr
Dorst
"T
As I said at Atlantic City three
says
Dr.
Dorst,
l
satisfaction.
Said he, "The fact years ago, it doesn't really mat¬
The' question which
that
American doctors, free of ter whether the Presidential
friends invariably bring out
government domination and se¬ message was an expression of the as the argument designed to ancure
in the
traditional doctor- Messiah-Complex or of political
nihilate any unfavorable criticism
patient relationship, have led the expediency. What matters is that of British medicine. 'Is it not true,'
world in these health develop¬ it
caught the popular imagination they say, 'that more people are
ments should be the answer to and that
many
of your citizens receiving medical care than ever
those critics who seek to destroy have tuned in to the idea and may,
before?'
Let me substitute the
our kind of system through a sys¬
at any time now, ask for some words 'medical attention' for
tem of socialized medicine."
practical fulfillment of the implied
erence
nomic
U*
U
professional
...
payrollTf
{he
mITran'swer
,
As
a
statement of faith on
'medical
the promise.
of one of your prominent
politicians that was, of course,
excellent. But I wish I could free
part
There
in this
nothing really new
inaugural message of the
At Hot Springs and at
President.
care' and the
answer
mg
§ J§^gjgg|Cfijfcl
J,Mr
deal-
papers
a
vflw
gBM
keting
MhkJWP^i
B
Section
in
of this dmsion
at the
recent annual
H.G.Johnson
meeting of the
American Chemical Society in
Atlantic City, N. J. Mr. Hal G.
Johnson, of the Monsanto Chemical Co., in his introductory remarks, explained that the recent
emphasis on commercial development and market research in the
chemical industry stems from a
number of factors. Among them,
he listed the rapid growth of the
industry> higher capital costs,
higher taxes, and a need for
greater accuracy in-planning as a
ovo
is
a
Payris is."
made for
weakness of our nature,
cine.
individual
and national,
wish
to
.
.
.
.
.
.
nromisina
on
Dro-
Vff elIorts on promising pro.
...
,
Mr. Hitchcock stressed the pnnciple that marketing research activities should lead to participation
of the sales department m the
work of technical and commercial
development projects. He coneluded his talk by stating that
as a result of the constructive
thinking of chemical industry m
the last decade, the activities es-
methods tends to nromote ar-
tlvRy toward
an
eaN v
cXlusion
the margin of
Llv"y toward an eariy conclusion,
and so helps to avoid inactivity,
marketing judgment. This
is. being accomplished by ascer-
which may be more costly in a
competitive. economy. Evenresu,t;
d.scovery itfie]f
far less the
reduce
to
method
error in
tainment ana presentation oi racts
by written and graphic means,
which fa becoming more
and more
accident and becomes mnrp the*
dtuaent ana oecomes more tne
result of planned expeditions into
important to the distributing end Promising territories,
^
The benefits
f
?* *he industry. Data is essential
The benefits of today's mom
proper judgment, not only for systematic methods are apparent:
existing products but also for new wben one contrasts nineteenth
century time lags of 25 to 50 years,
Products.
#
.
_
,
^
with the twentieth century
e
,
,
„
vals of 3 to 5 years
Mechanics of Research
tank
to
inter¬
from test tube
and:
Pasteurization
car.
Island, market research
sparpb
...
A
if
,
„
make a new product,
us
of the actual or
but
potential mar-
whether it will pay.
we can
*
ucts. It is directed toward
ascertainin&
the need, acceptance, sell*n ^ price,
po£ package volwUjMjt tential
„
c
nattprn<,
*
tells
us
sjs
Selling Principles
'111
iM^Hj com^etition
disVibution!
research
market
ket for Pr°d~
1-3
f
„
latter. Applied research tells
entails
pntails
determination
come
.
efforts
trates
nf
nnmpn+
these
.
discovery and elimination eoncenof unpromising projects and
development oi tools lor greater
accuracy has resulted from the
application of the scientific
Man, not Man for Medi¬ to professional disintegration. That
is the result of nationalized medi-
It is when you
ment
rtXrenf
in
fieS ta fedS
sential to the successful development of a new product can now
be set down systematically, and
having been so defined, can be.
«■»" of delegation of authority eomp,the SSStafc
hy management.
time and expense by the resultant
Mr* Johnson pointed out that false starts.inThe establishment o£
reduction
waste motion and
fnoiq for Prpatpr
early diagnosis of disease and its
adequate management — the
cine as I see it in Britain today."
to imple¬
good intentions that
upon
others, policies and
principles which we hesitate to wisdom and foresight are needed. uation .from a wider and more
philosophical angle. "My friends
adopt ourselves. If you read, in
British Socialized Medicine
reply," he says, "that they realize
conjunction with this reflection of
has
gone
too far, but
mine, Herbert Spencer's corollary
In July 1948 medical care was Britain
there are many good thihgs in the
to the cliche—whether originally nationalized
or,
as you term it
Curran's or Lincoln's or whose—
here, "socialized," in Great Brit¬ program and they wish to carry
about the price of liberty being ain. Many friends of mine in this o /er only the good things and inthem
into American
eternal viligance, viz., that "it is country know that I considered corporate
far less against foreign aggression the plan upon which our National medicine. When these good meanagainst liberty that this vigilance Health Service was based lacked ing people talk in this manner
and frighten me
is required than against the in¬ both of these fundamentals, and they astonish
more than they would if they
sidious growth of domestic inter¬
that, as the result, it would largely
frankly
advocated
nationalized
ference with personal liberty"; if
fail, as, indeed, it has done. This
medicine with all its trimmings,
I say, you add this reflection and
being so; I might be reasonably
They do not understand the
this
corollary to the
Senator's accused of bias if I gave you my
fundamental nature of Socialism
statement of faith, you may count own
summary of the view of my
m either theory or practice.
The
me
as
being amongst those who colleagues at home on the oper¬
idea of a self-limiting or tempobelieve with him that "the Amer¬ ation of the service. Let me rather
is too absurd
choose the conclusions of one of rary collectivism
ica of tomorrow" will be a nation
for serious discussion.
It is opyour own observers — Dr.
Stan¬
in which "our freedoms—and our
ley Dorst, Dean of the College of posed to the historical record of
Medicine in the University of Cin¬ every attempt at limited collec•An address by Lord Horder at the
tivism by a major nation.
.
It
Seventeenth
Annual
Assembly of the cinnati.
is contrary to the essential nature
U. S. and Canadian Chapters of the In¬
"What," asks Dr. Dorst, "do the
ternational College of Surgeons, Chicago,
Continued on page 41
thoughtful, intelligent members of
Illinois, Sept. 5, 1952.
both
oersonnef
of
teetotal
According to Lauren B. Hitchcock of the National Dairy DDT are examples of the former;
is Research Laboratories,
Inc., of nylon and butadiene examples of
mind of the thought that the Quebec the slogan had been an¬ answer is just as emphatically—
argument, as presented, contained ticipated and it has been repeated no!
a large element of what the logi¬
"A type of medical attention in
many times
since. There is no
cians call the "non sequitur."
reason whatever why meetings of which unbelievable abuse Of the
You remember the lines in the the medical
organizations of the doctor and the hospital are inexPious Editor's creed:
United Nations should not open tricably mixed with real medical
"I
do
believe
in
Freedom's with a few verses from the Sermon need is producing a technique of
cause
on the Mount, for
Medicine was medical practice which must lead
Ez fur away ez
.
^
But if you Oakdale, Long
in mpHiVai
interested in medical r»ar<a iho
care, the
are
"re-
described
Hitchcock
LWW|J se^h develooment fn oarallel
M WLMm,JBk svstem»Vhich^mrreletes nntnts of
ing with the
fundamentals
of chemical
Mar
developments and addi-
new
tional information,
my
It
part of
a
other research activities to the
final development of the product,
As this research proceeds, further
marketing possibilities are continuously reviewed in the light
| vHKwl
J
f§§§ of
the chem-
ical industry.
A
group
of
unequivocal—yes!
an
was
divisions of The research should be
many
Because they understand
trophe.
sistible.
now
Among the
this, the large majority of the med-
Services is one
President
the
physicians recognize it as the American Chemical Society, the activities which begin with
part of a rather desperate effort to the Division of Industrial and the
pilot plant and followed
avert social and economic catas- Enginering Chemistry is the most through
simultaneously with
agreement among physicians that
important part, because medical
the hospitals under existing ecocare
is
so
intimate a need of
nomic conditions must be subsieveryone." (M. I. Roemer.) And
dized by the State. But there is
so, whether you look at it from
much anxiety expressed because
the angle of the State, as ex¬
the government has taken over
pressed in the old saying: "A na¬
complete ownership as its method
tion's greatest asset is the health
of
nrovidine
subsidv
There is
of its citizens"; or from the angle
agreement
that
the
medical
of the individual, with whom both
schools
must
have
greatlv inthe cost of living and the cost of
creased support from public mondoctoring are rocketing, the pres¬
if*! and that this tax sunnort has
sure
upon
the politician to do
been wiselv administered
There
something about it is almost irre¬
is
unhversal
with
Witness
of
Chemistry
on
the
of
tration
...
and Engineering
Society hears papers
value of market
research and innovation in selling of chemicals, together with
problems of introducing and distributing new chemicals.
gency.
so
part of the movement
Industrial
of
American Chemical
alert to the
commercial
ical profession are trying to make and economic
individual man—will the system work even though frus- problems fac-
good;
Very
Division
developed. They
nationalization
that
much for the be their personal lot. And it is
me today was given as his subject:
agreed Article of Faith in general. working today, neither because
"America of Tomorrow."
Those But what of its operation on the the program was wisely conceived
Home Front, for it is that with nor effectively executed, but beof you who were present remem¬
cause doctors are doctors and take
ber how Senator Kefauver devel¬ which I am concerned here?
care of the sick regardless of ciroped his theme. He began by re¬
"Democratizing social change is
minding you that America has the order of the day. The organi¬ cumstances when the cards are
which
task
Maiketing Process Stressed
By Chemical Industry
work? ... In
they understand
must
place,
matrix
profession
under
system
people's efforts is basically a re¬
describes, in detail, operation of
Britain's Socialized Medicine, and lists four reasons for il§ fail¬
ure to carry out its purposes.
Says Britain's nationalized ex¬
periment "is splitting upon the rocks of economics," and British
doctors now take up more time preparing and signing reports
than in giving attention to patients. Warns our credulity may
lure us into the "Welfare State," and outlines actions to be
taken by physicians to ward it off.
sense
which
this
about
know
of England
Prominent British physician
My immediate and distinguished
predecessor in the very honorable
think
politics
LORD HORDER*
Physician to the Queen
medical
British
the
The principles of
zation
the
in
selling organi¬
chemical
industry
and the cost of marketing chemical
products was discussed by H. O.
Ladd,
I.
E.
the
of
du
Pont
de Nemours &
Co.
Mr.
Ladd
placed emphasis in his
trends and advanta:
policies for * already remarks on
s
well as proposed stepo which
wniwu
new
products. One of its most may be taken
|mp0rtant functions is to deter- to ensure ef-
along with
geous
saies
established
mjne
as
factors
which
make
can
it
expand markets for
new
products.
This
necessitates qualitative and quantitative analyses of total markets,
evaluation
of
competitive con-
possible to
absorbing
sales
of
estimates
ditions,
fective
mar-
keting
of
chemical
products
well
trol
as
to connonfixed
as
potential selling ajid
Harold
O.
Ladd
and by classes of
distributing
consumers,
forecasts
of
future expense. He gave illustrations of
demand and supply trends, and the aDnijcati0n of his nrinciDles
by areas
estimates of proper
which
will
selling prices
permit
the
largest
All this research
t t d
should hp
pr0gram
an
is, Mr. Hitchand
infperal
of appiied
development of
a
application of brief principles
of his case his¬
discussion
tories.
potential profits.
k
by
a
nart of
research
new
anv
Mr.
the
—
Ladd
also
importance,
commented
as
well
as
on
the
—
limitati°ns of published economic
product, and market data as aids in plan-i
and
Volume 176
Number 5154
...
The Commercial and Financial Chronicle
(1121)
ning direction, control and actual
promotion
of
sales.
*
*
covering
the
presented
by
paper
subject
same
was
Wroe
Alderson, of Alderson &
Sessions, Philadelphia, Pa. Mr. Al¬
derson
stated
tion of
of
that
the
introduc¬
David Rockefeller has been
ap¬
a
Senior Vice-President
of The
Chase
National
Bank,
re¬
for
customer
relations in the metro¬
the
supervision
he
ago,
pointed
tomary to
uct
and
it
out,
announce
then
happened
far
long rich,
so
was
of
might lag for several
1946, when he joined
Foreign Department staff as
its
Rockefeller also
in 1950 of
an
a
was
new
the founder
Chase quarterly
assistant manager, after
complet¬
ing three and a half years of war¬
time service in the United States
lights," which has attracted wide
interest
tions
After
as
Second
successive
assistant
cashier
Vice-President, he
pointed
a
promo¬
and
economic
"Latin-American
in
this
Business
High¬
son of
Republic
Company, Far-
With First of Iowa
country
and
John D. Rockefeller Jr.
The pace of
-
Corporation,
Des Moines.
ac¬
while
technological change
makes
procedure
in
such
casual
a
marketing increas¬
ingly1 hazardous. The period of
maximum
opportunity for a given
last as little as ten years.'
use may
Much of the commercial
potential
of the
product may be lost if it
takes half that time to learn how
to sell it.
tive
The threat of competi¬
developments,
Mr. Alderson
greatly by the
announcement of the new product
and
may
further
dissipate
its
profit possibilities if its market
said,
increased
is
potential is not developed rapidly
from that day forward.
*
%
#
■
Marketing Problems
Concerning the marketing prob¬
lems involved in the introduction
of
new
chemicals, it
pointed
was
out in
a paper
by R. L. Bateman
and J. A. Field of the Union Can-
bide and Carbon Corporation that
competition
in
the
chemical
J.
keener, and this
chemicals.
and
CHASE SERVES THE
Field
been
never
calls for
of the methods for
new
A.
industries has
process
a
review
introduction of
The
"rifle"
vs.
"shot gun"
the
techniques, timing on
introduction, specifications and
and physical and
chemical prop¬
erties, distribution of samples, us¬
age research, and patent protection
were
discussed
Special
them
THROUGHOUT THE WORLD
by these experts.
was
given by
attention
to
toxicological
OVERSEAS
considera¬
BRANCHES
tions and problems of
labeling and
of traffic and
distribution.
Every hour of the day the facilities of the Chase
—
Richard
E.
Wiley is with Kidder, Peabody &
Co., 75 Federal Street.
to
The
Financial
the chemical
Osaka
.Havana
Marianao
industry.
San Juan, P.
WIDE BANKING
R;
Santurce
With Waddell & Reed
(Special
Tokyo
to
rV/ORlD
SOUTH
Heidelberg
Stuttgart
branches, representatives and correspondents, at home
and abroad, Chase
provides service of world-wide scope
(Special to The Financial Chronicle)
Mass.
Frankfurt/Main
being employed in the service of businessmen. Through
Kidder, Peabody Adds
BOSTON,
London
are
Chase has the
personnel, experience and equipment to
Chronicle)
Panama
Colon
cover
DARTMOUTH, Mass.—
Donald B. Carr is with Waddell &
tant
every
financial need of its
customers in this
impor¬
David
Cristobal
field.
Reed, Inc.
Balboa
Offices of
■
Wahler, White Adds
Representatives
Mexico, D. F.
(Special to The Financial Chronicle)
KANSAS CITY, Mo.
C. Lambkin is
White
&
now
—
with
Co., Dwight Building.
LOUIS, Mo.
is
Slayton i&
Olive
now
—
Oliver
associated
Company,
Street.
Inc.,
NATIONAL BANK
OF
THE
CITY
OF
NEW
Member Federal Deposit Insurance
Corporation
W.
with
408
,
Rome
Cairo
Bombay
\;
(Special to The Financial Chronicle)
Hickel
THE CHASE
Wahler,
Joins Slayton & Co.
ST.
Buenos Aires
Roland
YORK
■
HASTINGS, Neb. — Dale D.
Welch has become affiliated with
the First of Iowa
the company was
learning through
trial and error how to sell it.
nowadays
Pol-
Building.
Sales
years
E.
affiilated with
(Special to The Financial Chronicle)
David Rockefeller is the youngest
nam
Neb.—Julius
has become
entitled
abroad.
was ap-
Vice-President in 1949,
publication
enske
Central
what
market
concerned.
was
He
Chase National Bank
since
(Special to The Financial Chronicle)
OMAHA,
prod¬
see
to
as
Chairman of the bank.
the
of¬
Joins Central Republic
cus¬
new
a
wait
so
ceptance
Not
ficer of
an
with
supervision of the bank's
business in Latin America. Under
his direction the Chase has
opened
several
new
branches in Cuba,
Puerto
Rico and
Panama.
Mr.
Army.
sponsible
products and the de¬
politan area, including the bank's
velopment of effective plans for
New York City
branches, it was
marketing them present a major
challenge to executives in the announced by Winthrop W. Aid-
industry.
Mr. Rockefeller has been
pointed
new
chemical
department.
Sr. V.-P. of Chase
Challenge to Industry
Another
also will have general
supervision
the bank's economic research
David Rockefeller Is
£
13
THE
CHASE BANK
Paris
14
The Commercial and Financial Chronicle
(1122)
Bank
assets
Supervision and the
Bank Capital Problem
tion
be found in
can
again, and dur¬
ing a Crucial period.
All of this spells out that if we
changed to a more realistic asset
evaluation, the need for additional
capital
would be more clearly
Association
our
realistic and
more
liberal
more
and
4
reserves
have
subsided,
been
in the
building of this amazingly
nation.
productive
r e c o
that
1
p
has
competition
of the very, great factors
one
its
It
be
must
our
here
that
other
do not play together
in your back yards.
you
too much
something
coun¬
same
public interest, even
the
in
though
tries
Problem
generally
the American Bankers Association,
in
"United
the
duce
all
of
the
world.
dom
I
Harold
Free¬
to
incentive to
known before by
never
people, and has provided
many
fertile ground for the growth of
our
competitive
be
two-party system at
Strong competition needs to
maintained
field
be
can
we
of
areas
must
guard1,
field, against
that
the
in
the
political
though at times there
even
so
agreement; but
in this political
much agreement
competition of
two-
our
This year we have had the hear¬
the
Without
a
have
done
lines
Patman
doubt,
Committee.
to
and other factors. It is pointed out,
however, that while this is only
about 5% of the 4,946 national
banks,
there
tional
banks
additional
are
which
na¬
might
be
borderline
category
and could use additional
capital to
in
termed
a
On this, bankers and
supervisors have a common inter¬
advantage.
both
want
to
banks
see
have
Bankers
mindful
been
of
the
that
fact
the
in
last
ten
banks have voluntarily in¬
their
have
a
principle
is,
'Good
World
War
has had
funds
capital
II
and
its
aftermath
debilitating effect
a
from
upon
cerned, finds
of bank
a
parties
con¬
parallel in the field
supervision.
stock
here
and
may
expect that
in view
earnings
the
nationwide
.
capital accounts to total
.
declined
assets
in
ers
their
from
is
It
the
ratio
is
13.2%
to
only about
18 years ago."
was
generally
eld
assets
banks
of
recognized
capital
deposits needed
or
that
total
to
a
change
because it did not properly evalu¬
growth
be attractive. Under
little
hope
for
of their responsi¬
flow of inflation in order to have
would be accepted
bility. Your discussions
standing
were
and under¬
desirable.
You
are
to be complimented that your dif¬
ferences, where they existed,
not allowed to blossom into
were
a
full-
scale conflict. After resolving
your
differences of opinion, and work¬
ing
out
The currently discussed measur¬
ing stick is capital to risk assets.
As
presently
assets
are
duction
clude
that
the
net
result
will
be
closer understanding among the
various agencies, to the end that
banks and the public will be more
a
effectively served. What
done is in complete
the
basic
of
This
of
the
dual
cash
after
and
risk
the
due
by government
means
largely
de¬
from
that
the
considered,
agencies.
risk
assets,
all other
are
This method of
assets
though
deserves
further
Our dual banking system has
played a tremendous role in our
dynamic economic development. It
of the assets with elements of
or
cover
all
risk,
evaluate the extent of risk
for
embraces the fundamental princi¬
each. For example, a different risk
factor should be used for different
ples
types
checks
and
of
♦An
address
by
Mr.
Brenton
at
the
Annual Meeting of the National Associa¬
tion
of
Supervisors
of
State
Banks,
Baltimore,
Md.,
Sept.
24,
1952.
tion,
the
pro¬
value
the
of
na¬
The major func¬
to
and the cost of produc¬
both
civilian
eliminate
of assets since
loans
others. I
carry
am
more
some
risk
convinced that
types
than
some
part of long term government
government
guaranteed
or
assets
our
of
and
and
military,
prof¬
prevent
for
measures
economic strength
activities
main
of
the
are
secu¬
Office
an
of
program
Stabilization
stable
a
price
the
Office
is to main¬
structure
and
con¬
and
producers, while fur¬
thering defense production.
would
menharm.
be
Authority From Which Agency
by the market
times.
good
would
tle
IV
For
my
holder,
I
part,
as
don't
preferred
want
stock placed ahead of my common
stock ownership.
.
.
>
(3) Greater Additions to Capital
Structure
from
Since
1940,
banks
Profits
Net
insured
have
added
Almost
all
of
this
has
after
com¬
over
been
through retention of net profits.
Nevertheless, with inflationary
pressures
and high taxes, the ac¬
and
The
wide
hasn't
In
banks after taxes and
reserves
had
7.8% of their capital funds avail-
Continued
on
page
46
the
De¬
of
1950
Congress)
powers
upon
stabilization.
law
of
cation
investors and
per¬
of
the
reasonable
a
purchasing
balance
and
power
goods and
services, the protection of the na¬
tional economy against future loss
supply of
needed
of
consumer
purchasing
power
by
dissipation of individuals' savings,
the
and
of
prevention
future
a
that
With
origin and
to turn for
sideration
the
gave
for
the
control
of
materials.
It
also
con¬
its
I should like
few moments to con¬
of
of the aspects
some
interest
to
are
Rubber,
The
organization.
of par¬
people of
you
Chemicals, Drugs and Fuels Divi¬
sion of the Office of Price Sabiliin
zation
has
Branch
staffed
your
who
of
the
it
a
with
and
industry
ment
have the
-
Chemicals
people from
from govern¬
responsibility
carrying out the objectives of
Defense Production Act with
regard to the pricing of chemicals.
the 20 months since the estab¬
In
of
lishment
it
branch
that
has
considerable number
regulations and letter orders
establishing
price
ceilings
or
procedures for determining them.
drawn
a
up
of
know, the chemical in¬
you
dustry for the most part operates
under
22.
Ceiling
Regulation
Price
There have been issued under
that
a number of sup¬
regulations which
some
way modified
its
.regulation
plementary
have
in
provisions
lems
President
a
of
outline
activities which
our
this
brief
purpose,
meet special prob¬
market condi¬
to
unusual
or
tions.
You
are
special actions
familiar with such
as
SR-105 to the
poly¬
GCPR which covers certain
vinyl
resins,
chloride
and
Sup¬
tained certain limitations and
ex¬
plementary Regulation 12 to CPR
Specifically, it limited 22, which keens certain organic in¬
authority to impose ceilings secticides under the provisions of
ceptions.
the
on
on
agricultural commodities
products
manufactured
processed in whole
from
specifically
real
services,
1951, all insured commercial
81st
certain
powers
ings
just
774,
of
Act
prices and wages and for the allo¬
dure.
growth
Law
wage
part
been able to keep pace.
VII
the President with respect to price
cumulation of capital through this
method is a relatively slow proce¬
Capital
Title
and
conferred
bank stock¬
a
Regulations—Ti¬
Production
(Public
ment.
Price
Ceiling
fense
already have been partial retire¬
scar¬
relatively fixed incomes
between
As
Derives Its Powers
periods
protection
In
there
needed,
tenance
of
integral
safeguard the interests of
sumers
stock.
or
consumers,
undue impairment of their
living standards. In addition, the
Office is charged with the main¬
ticular
to
protect
earners,
with
cf
tain
opposed. Preferred stock
in
wage
to
collapse of values."
of Price
of a
the
preferred
and
and
will
$5 billion to their capital accounts.
determining risk
consideration. It does not
competitive
of living
program provided by Congress in
the Act.
The
primary function
through
when the added capital
mercial
Determining Risk Assets
system of banking.
of
issuance
Taxes.
loans and other securities.
harmony with
principles
considered,
assets
banks, United States government
securities, and loans guaranteed or
have
you
all
the
only
attainable goal.
an
mutually, satisfactory
agreement, it seems fair to con¬ insured
a
be
provided
To achieve this purpose, a num¬
I also am
had to
serious
(2) The Offering of Preferred
ber of integrated activities are re¬
Stock. Perhaps a market for new
quired to support price operations,
preferred stock could be estab¬
such
as
public information, in¬
lished, but it would probably need
dustry advisory committees, co¬
to carry attractive redemption or
operative
activities
with
other
conversion privileges. So far as I
government
departments
and
have heard, most of you super¬
agencies, as well as an enforcevisory authorities are opposed to
cnanged to move along with the
of assets. It also
a
it
record
part of the economic stabilization
sale of common stock.
state supervisors
gory
much
al¬
at
building the national
The
existing con¬
solution
with
Price Stabilization
ditions, however, there appears to
be
time
a
rity.
low
stock
Act
wHle
where sale
areas
common
at
economy
operating
maintaining
dividend rates. Here and there are
additional
carried
be
also
of present
was
tion
unfair to the present stockholders
the Federal
areas
to
from
defense
The Congress,
therefore, in the Defense Produc¬
bank
new
could
It
national
ap¬
threat of inflation.
to further dilute their share of the
system. This was recently
pointed out by Earl Cook, director
of the Federal Deposit Insurance
Corporation: "From 1934 to 1951
.
buying
ate the risk inherent in each cate¬
in various
is
defense
price ceilings to stabilize the cost
was
vast
a
program
the
levels
people would
many
stock.
common
on
ready
there, with present net
be interested in
embark
when
the sale of
be possible
While
$7,100,000,000.
I read with great interest the
July 3rd text of accord between
and
quote:
Jfie Office is to establish
Fogle
sons
production
stock. This is a small
amount compared with the total
national bank capital structure of
copimon
ing
half what it
working to¬
interest,
the rights and
public
preserving
of
the
E.
of
Act
To
through the sale of new
structure
of
gether
privileges
E.
•
1950, which
proved Sept. 8, 1950.
approxi¬
added
1951
the capital-asset ratio of the bank¬
6.7%, meaning the equity of bank¬
the
in
banks
banks in
fences make good neighbors.'"
This principle of
for
and
cities.
mately $150,000,000 to their capital
by
the less they invite themselves in
to play in each other's back yards.
while
preserving
tional curpencv.
tion of
the
tion
national
that
out
years,
better end result and
[that] the
Treasury and the System will be
better neighbors in the long run,
proper
points
Report
the
creased
will
national
normal market conditions
Sale
profits after taxes, it is too much
that each has its sphere in which
to operate. As one Senator said at
Stabilization
the
The Congress responded to this
need
with the Defense Produc¬
of
Additional
Common Stock. The Comptroller's
(1) The
to
interest, it has been reemphasized
Or¬
I
by re¬
ducing the effects of inflation and
public of Korea on June 25, iaou,
made clear to the American peo¬
additional
obtaining
common
have adequate capital.
$6,951,393,000 to $11,615,767,000.
The
inflation
resulting
from
The
In
Price
mote
The invasion of the Re¬
Agency.
Capital
Means of Obtaining Bank
its
in
Statement.
the
this
me
v. purpose of the
of building bank capital,
ways
na¬
Board. While they have a common
"We
and super¬
authorities to devise new
visory
it is found
as
in
of
purpose
bank
iteering, hoarding, manipulation,
capital, there are several possibili¬ ple that this nation needed a much
speculation, and other disruptive
tional banks are definitely under¬
higher level of preparedness to
ties, with varying degrees of effec¬
practices,
resulting ' from v ab¬
capitalized when capital structure
assure national security and
peace.
tiveness.
discloses that fewer than 390
Treasury and the Federal Reserve
hearings,
swiftly
origin
interested
"The chief purpose of the Office
of
might
I
be
Zo£ the
ganizational
start by out¬
lining for you
it will
resumed,
the
clarify
of demarcation, between
these
is
devolve upon bankers
Preston Delano. This report
rency,
inflation
Agency
it
that
news¬
"
may
statement
of
to
maga¬
radio, television, theatres,
outcoor
advertising,
insurance
rates, rates of common carriers
You
you
Industry,
associations
press
services,
papers,
Chemical
seemed
general public disapproval.
no
If
the
this
this capital problem as evidenced
these -hearings
much
splendid 89th Annual Report
Comptroller of the Cur¬
the
est—we
party system is weakened.
ings" of
the
is
to
by
cooks,
zines, motion pictures and
ments.
in¬
gentlemen
con¬
no
that
believe
to
icature
and
public utilities, and
com¬
modity exchange margin require¬
is studied in relation to risk assets
productive genius.
In this election year, we see our
work.
recently read with much interest
of
pete has engendered
so
Brenton
com¬
degree
business leaders.
the Congress, and
the
rest
thoughtful
is
There
rate.
reason
publication
or
greatest
terest
higl^r
outpro¬
lation
for
popu¬
crete
In
talk
possible
spending goes on at an
alarming
appreciated.
de¬
to
this
the
States
the
a
order to be of
trend has been halted. So far there
of
world's
a
turn
allow
consideration not
only by the various supervisory
authorities, but also by the banks,
7%
can
trying
greatly
We
increased- level.
level. Our
when less than
for
should take in
freeze prices at the new
we
was
is
still exist.
frozen at
pressures
practically
are
talk
cide the exact
those
caused
which
given
an
important place in your text
of accord. It is certainly a problem
capitalization
Bank
do not possess,
a
inflationary
Prices
each
zation
have out¬
assets
bank
to
regarding the activ¬
ities of the Office of Price Stabili¬
bank capital structures. The
factors
Lists
opportunity
few moments
emergencies to be created which
make for further increases; then
Capitalization
The Adequate
This
bond hold¬
ings and increased loans. Over the
ten years, with inflationary
grown
liberalized policy to meet current economic
more
recent basic exemptions from
price controls
concludes, chemicals generally "are not eligible for decon¬
trol to any important extent even under new standards."
last
pressures,
a
and
no
and bring in its
bank assets with
greater
fence when
back
the
is
again
course
constructive
good,
many
over
is
it
peo-
have
e
have
federal supervisors
the
and
state
visits
i zed
g n
in
Constitution. I hope that you
our
reveals
conditions.
will not resume
that it
assurance
wake
which were set forth
balances
tion, Mr. Fogle discusses problems relating to pricing of chemi¬
cals.
Says chief difficulty is in pricing new products, but
is impor¬
there
but
Division
After outlining origin and
purpose of Office of Price Stabiliza¬
why
reason
capital
bank
increased government
for
Freedom
Director, Rubber, Chemicals, Drugs and Fuels
Office of Price Stabilization
tant. Inflation at the moment may
capitalization problem will be perma¬
line is held against inflation.
nent unless
another
is
There
adequate
solution if bank
no
By ELSTON E. FOGLE*
shown.
key business,
against losses of risk assets. Warns banking is a
*
Current OPS Policies
value.
marketed at their book
be
This could happen
dual banking system, discusses
bankers' responsibility in the future. Stresses the adequacy of
banking capital as most serious problem, and says partial solu¬
supervision under
banks owned
securities and loans that could not
in pleading for Federal-State accord in
Mid-western banker,
bank
Pricing Chemicals Under
not
saw
we
Thursday, September 25, 1952
.
risk
element
an
As
months ago,
many
Des Moines, la.
Vice-President, American Bankers
carry
risk.
market
of
BRENTON*
By W. HAROLD
President, State Bank of Des Moines,
they
as
with
included
be
should
.
♦An
farm
or
and
the
and
lation
substantial
commodities.
It
exempted from ceil¬
property, professional
materials
address
by
Mr.
furnished
for
Fogle before the
of the Synthetic
first of the Fall meetings
Organic Chemical Manufacturers Assoc'ation cf
the United States, New York City,
Sept. 10,
1952.
General
—
tion 24 to
for
Ceiling Price Regu¬
Supplementary Regula¬
CPR 22. which provides
tailored
pricing
of
certain
phthalate plasticizers.
The
problems
with
which
the
Chemicals Branch has to deal to¬
day
are
largely
involving the
prices for
special situations
ones
establishment of ceiling
new
products
which
arise
or
because
of
changing
Volume 176
Number 5154
..
The Commercial and Financial
Chronicle
.
(1123)
conditions
or
unforeseen develop¬
ments. The
people of the Branch
are anxious
and willing to be of
help in every way possible. If a
careful
stutfy
of
tered
burden
great value to
number of
a
attention to
a
which
miliar,
of
these is
not
General
1
SK
Overriding Reg¬
1, which had provided
exemp¬
from price control
for cer¬
tain specified
commodities, among
which were "Chemical
Products"
when especially
tion
designed to
military needs
fense agency.
was
Products
was
order.
sold
to
some
producing
defense
to
which
rheet
from
"de¬
means
all
price
the
of
cost
All
and
nec¬
criteria
examined
or
for
action.
on
The
products.
a
price
the
of
commodity
below ceilings, and
time
as
costs;,
approach
more.
A
ceiling levels
"trigger" mecha¬
Exemption from control
approved when it
that the situation
number of
(b)
or
shown
Branch is
service
or
actively at work on the
problem and will make some spe¬
does
a
the
ma¬
fol¬
lowing conditions:
cific
meets
(1)
recommendations within the
not
enter
or
service
significantly into
the
ma¬
trative difficulties for OPS
sellers
of
which
are
the
material
disproportionate in
We
the
or
in
the contribution to the
stabilization
(2)
The
program.
material
or
service
is
appropriately separable from
other materials
not
merely
broader
subdivision
a
There
that
terial
or
price
services and is
of
a
area.
show
nificant
or
trol
ices.
not
such
levels
of
suspend
action
prices
suspension
special
is
no
decontrol
evidence
of
the
adverse
effect
when
to
ma¬
a
sig¬
on
the
considered
in
of related materials
or
serv¬
Moreover, before
action is
watching
taken,
system
lished, and
'
a
lor
created,
Increments
Manufacturing Chemists'
an
attempt to
some
difficult
from
this
on
outline
for
situations
us
arising
Overriding Regulation
certain
be
action
action.
General
may
some
of
long-term contracts
interest.
These
are
contracts for more than
one year,
and entered into
prior to Jan. 26
1951. A number of
such contracts
have been
approved under this
regulation.
It permits
escalation
clauses of such
contracts to re¬
sume operation
under rather flex¬
ible control.
New
Policy
During the
last few months
the
Agency has been
policies and
ing old
developing new
reviewing and revis¬
ones
economic
to
meet
the current
conditions
and
recog¬
changes which have come
about because of
actions taken bv
our
sister
agencies.
The
steel
copper and aluminun
price in¬
nize
creases
particulars
—
settlement
broke
—
standards
being
the
steel
One of the most
through the
used
by
Agency
to
and has given impetus
the re-examination of
policies
and
procedures..-The Director
interesting things about
the nature of the chemical business is that
the
it
does
added
of
Price Stabilization
recenpy issued
a
number of statements
in the
form of press releases which
most
than
more
provide the "value
by manufacture" characteristic of
industries.
mav
interested
in
of
some
principles
on which the
is to rest:
gram
"The
new
meet the
program is
the
Chemistry includes the
where
be
basic
new
an
situation.
It
our
designed to
exigencies of the present
over-all
reflects
The
the
country's
chemicals in the
fense
low
Production
ognizes
funds
law.
Act,
and
rec¬
the
and
limitations on
time,
authority imposed by
It takes into account
i
'■
upward pressure
-
on
of
greater
prices in the
normal
j
,
to
rearrange
their mole¬
cules to increase their values—in the form
and
fibers, plastics, dyes, pigments
synthetic rubber.
Even the value of the soil itself has been
enriched
tion of
through the increasing applica¬
chemicals and
ing it produce
more
techniques in mak¬
abundant and higher
of metals from
quality foods to meet the world's
interesting
ing demands.
an
of
low grade
use
our
ores
or
once
ex¬
re¬
complex to
have been made
country's wealth
copper, manganese, zinc, iron, tung¬
sten, chromium and other metals.
increas¬
Thus, by making possible a fuller utiliza¬
tion of the world's
resources,
American
Cyanamid Company research is constant¬
ly increasing values for the industries it
serves.
Under
conditions
controls
have
American
way
be
f
Assumptions—(1)
has shown how
recovery
resources
as too
our vast resources of
petroleum, chemical research
offer
available to increase
that
plus
resources.
permit economical
immediate future.
"Basic
ores
ample. Vast
recent
it recognizes the
probability
there will be somewhat
grade
garded
special price increases made with¬
out regard to OPS
standards, and
...
development and application of
intention of Congress
as expressed
in the recent extension of
the De¬
creation of values
not exist before
expansion and appreciation in value
pro¬
of
they did
and
of textile
out¬
lined the policy of the
Agency for
the next few months. Vou
Similarly, utilizing
coal
direct
price
no
place in the
of life. They should
employed only when inflation
endangers the public welfare
and
safety.
h:
"(2) The present and prosoec-'
tive economic situation
requires
that active price controls be
con¬
.
»
_
tinued in many
omy
and
"(3)
areas of
the
econ¬
suspended in others.
Where active controls
continued,
American uianamui company
are
ceiling price increases
must be limited to those
required
by law
"(4)
or
by fairness and equity.
Where
continued
active
controls
are
they must be' adminis¬
30 ROCKEFELLER PLAZA, NEW
A
must
Continued
borne
in
YORK
20, N. Y.
suspension
adequate price
be
estab¬
determination made
agencies.
We shall
be
know of any
difficulties
this change has
Association has taken
any
an
*
companies
have
already
consulted with us about
this mat¬
ter. The
any
finding made that prices are
materially below ceiling, and that,
no prospect that
reimpoi
sition of controls will be neces¬
sary
in the foreseeable future.
were
chemicals
ap¬
spe¬
action, there must be
prob¬
a
result
margins
a
Re¬
companies who
or
higher than permitted under
plicable regulations.
More
cifically, in connection with
de¬
a
2
contro'
would
there is
service will have
level
will
where
,
price
present
diversion
and manpower from
sellers remaining under control.
re¬
the effectiveness of
service
or
of materials
the
or
Exemption from control of
material
substantial threat of
no
service
or
conjunction with previous decon¬
(a) The material
(4)
business
Control of the
service involves adminis¬
or
(3)
will be
be
can
involving
terial
Chemicals
terial
selling prices
tion of control.
example, are
Suspension orders
other
to
the
&ill indicate when this
point
reached, followed by reactiva¬
is
for
have been issued
a
and
nism
determine
eligible
.are
such
begin
for¬
prices
service
or
until
areas are
suspension
linters,
suspended.
to
be
may
are
for
means
regulation
once
commodity
ones
decontrol
Cotton
price
hand, "sus¬
retaining a given
living of the average
American family or into
issued, "Chemical
drooped from the
That has created
lem for
glad
and
When GOR
1
vision
standards
being
important.
important of
is
proceeding with«the program,
which
fa¬
thereto, replacing GCPR,
term
OPS
On the other
pension"
promptly and efficiently."
mulated.
ulation 2, Revision
1, and Amend¬
ment
In
are
most
by
control
of
your
be
The
used
removal
selling
it
and
suspension and decontrol
may
weeks.
as
complete
lation to
new
might call
which
the
enterprise.
ceilings which it sets, but render¬
ing them inoperative while actual
people in
few recent actions
you
but
One
been
business
two
control"
that plans be available to
meet it
in¬
cases.
At this point I
with
has
industry
next
controls.
essary
his staff
an
upon
possible
as
administrative
inflationary crisis,
applicable
regulations does not indicate a so¬
lution to your
problem, I suggest
you consult with the
Chemicals
Branch Chief or some of
Such
efficiently
"(5) The danger remains acute
that international or domestic
de¬
velopments might create a new
the
about your problem.
formal jconsultation
as
and with minimum
1
on
page
23
16
phia
approved
Sept.
on
the
18
Better Public Relations
Sought
By Chemical Industry
agreement to merge the two banks
under the name and charter of
News About Banks
NEW
BRANCHES
NEW
OFFICERS,
Philadelphia, it was announced by
C.
A. Sienkiewicz, President of
Central-Penn
and
C.
Russell
Bankers
and
ETC.
REVISED
of
Bank
National
Central-Penn
CONSOLIDATIONS
American Chemical Society lists objectives of its new service
in better serving the public and disseminating information on
chemical science and technology. Speakers stress value of
Arnold, President of South Phila¬
delphia National. The merger plan
which
was
announced early in
CAPITALIZATIONS
by the Directors of both
subject to the approval
of the U. S. Comptroller of Cur¬
sound
August
Vice-Presi- ings Bank of New York. Mr. Phaof Bankers Trust Company, len, who was formerly Vice-PresiYork, has been named head dent of the American Telephone
& Telegraph Co., had been a mem¬
ber of the East River Board of
Trustees since Sept. 13, 1951. The
S.
T.
dent
New
September 25, 1952
The Commercial and Financial Chronicle... Thursday,
(1124)
Mason
Frey,
Board of Trustees adopted a reso¬
expressing appreciation for
Phalen's helpful cooperation
lution
Mr.
his
regret
with
accepting
and
which was necessi¬
by his new position.
resignation,
tated
«
*
«S
Considerable
attention
is being
Informed Public Essential
given by the rapidly growing
The
basis of exchange
According to a paper read by
chemical industry to the cultiva¬
under the agreement was one and
James W. Irwin, Public Relations
tion of better relations with the
one-quarter
shares
of CentralCounsellor
of
Shaker Heights,
A whole ses¬
Penn stock for each share of South consuming public.
Ohio, every facet of business and
rency.
Philadelphia National. Details of
the merger plans were noted in
sion
on
ties
was
Public
Activi¬
Relations
held
jointly by the Divi¬
sion of Industrial and Engineering
our
Aug. 14 issue, page 572. The
Chemistry and the Division of
enlarged Central-Penn Bank will
Chemical Education of the Amer¬
have
capital,
surplus and
un¬
ican Chemical Society at the re¬
divided
profits
of
about $17,900,000; total assets of over $200,-
Ltd.,
Tokyo,
of
an¬
and deposits of approxi¬
$190,000,000. The consoli¬
000,000
the opening of an agency
mately
Bank
The
public relations policy.
is
banks
cent annual convention in Atlantic
City, N. J.
A number
presented
of papers
industry, ev¬
ery facet of
education,
ev¬
of
profes¬
branch
ery
the
sions, whether
they
in
be
groups
as
or
public rela¬
individuals,
tions experts, by members of the
face new and
office to conduct an international dation will increase the number
press, and by executives and of¬
serious
sociobanking business at 100 Broadway, of Central-Penn's banking offices ficials of chemical
concerns deal¬
New York.
Yeisuke Ono is di¬ from ten to twelve. Former offices
economic
ing specifically with this subject.
South
Philadelphia National
rector and agent in New York. A of
problems in
the period in
S. T. Mason Frey
license to maintain an agency in located at Second and Pine Streets
William H. Moore
Aims of News Services
which we are
New York was issued to the bank and at Broad and South will be¬
of the Out-of-Town Division, it
Dr.
Walter J. Murphy of the
now operating
by the New York State Banking come Central-Penn offices effec¬
Jam„ w. lrwl„
was announced on Sept.
"Chemical & Engineering News"
22 by S.
as well as the
tive
about
Oct.
31.
C.
Russell
Department on Sept. 11.
Sloan Colt, President. In his new
listed the public relations objec¬
it
%
m
period ahead.
Arnold, President of South Phila¬
tives of the American Chemical
capacity, Mr. Frey will assist J. P.
People are restless and nervously
George C. Johnson, President of delphia National, will become a
Dreibelbis,
Vice - President
in
Society, oper¬
stimulated
Vice-President
of Central-Penn.
by the uncertainties
The Dime Savings Bank of Brook¬
charge of the Banking Depart¬
ating through
of
their individual futures.
He
All
employees
and officers of
ment.
At the same time, it was lyn, N. Y., announced on Sept. 23
its ACS News
South Philadelphia National will
pointed out that rumor factories,
announced that William H. Moore, that the board of trustees of "The
Service.
Ac¬
as always,
are running overtime,
Dime"
had
made the
following be retained in the enlarged bank.
Vice-President, would succeed Mr.
cording to Dr.
and advocates of
alien philoso¬
Norman C. Ives, who served as
new official appointments: Robert
Frey as head of the Bank's Far
Murphy the
Chairman of the Board of Direc¬
phies are making unmistakable
W. P. Morse to Assistant Treasurer
West District.
Mr. Frey joined
principal aims
tors
of South Philadelphia Na¬
headway in their programs to ob¬
and Arthur F. Johnson to Assist¬
nounces
Bankers
in
Trust
1932.
Assistant
elected
He
was
Treasurer
in
1943, Assistant Vice-President in
1945, and Vice-President in 1948.
Mr. Moore joined the bank staff
in
He
1938.
elected Assistant
was
Treasurer in
1948, Assistant Vice1949, and Vice-Presi¬
President in
tf
*
V
of "The Dime" in Feb¬
1933 as
ruary,
he
was
office
main
the
to
branch.
Flatbush
bank's
the
at
clerk and teller
a
Two years later
Frederick
G.
Officers
In
Rudolph
as
December, 1950, he was
Assistant Comptroller.
Morse, a veteran of World
appointed
Mr.
War
Trust Company of New-York was
First Lieutenarit in the U. S. Army Finance
announced
Division in the China Theatre. Mr.
Manufacturers
at
II,
served
as
a
Sept. 22 by Horace
C. Fanigan, President.
Both men
are
assigned
to
the
Corporate
Johnson started his banking career
with
the
Trust
1933.
In
Mr.
on
of the
Deartment
joined
Philips
the
company.
Chatham
Bank
became
Man¬
in the
two
ment.
associated
ufacturers
institutions
was
with
Trust
the
when
the
merged in 1932.
He
an Assistant Trust
appointed
Officer
in
1941.
started his
Mr.
banking
Rudolph
in 1923
War
as
a
Area
He
appointed
was
facturers Trust in
The
1944.
appointment
J.
also
is
nounced by President
Cornelius
an
of Manu¬
Sager
an¬
Flanigan of
Assistant
as
lyn)
for
Grand
He
was
a
turers Trust.
ports.
Mr.
and
He
pany.
charge of the North
(Brooklyn) of the
is
Queensboro
member
a
Chamber
Gavin
Com¬
director of the John J.
a
member
of
the
Regents and at
one
the
on
Board
Brooklyn
of
Edua-
"Eagle"
re¬
Mollenhauer
Brooklyn
June
born
was
14,
in
After
1871.
completing his studies in borough
the public schools, he started out as
merce, the Bankers Club of Brook¬
lyn and
Masonic
com¬
of
of
former
and
the
It added:
"Mr.
Secretary since 1945
in
was
Side Office
Sager has been
former
State Board of
the
Assistant
of
Lodge of the State of New York,
died on Sept. 18 at the age of 81.
tion,
an
Dime
years
many
Master
Queens Plaza Office of Manufac¬
of
C.
Mollenhauer,
Savings
Williamsburgh (Brook¬
was
charge
the
*
the
of
of
time
in
❖
Christopher
the
Vice-President
in
Major
a
*
Bank
Bank.
as
S. Air Force.
U.
the
Assistant Trust Officer
World
II, Mr. Johnson served in the
Pacific
President
National
Savings
of
veteran
a
an
employee of
real estate
a
of which he later became
ber.
In 1925 he
a
firm,
mem¬
elected Presi¬
was
dent of the Dime
Co:, Inc.
Savings Bank of
The
election
of
Frederick
#
V.
ory
Textiles, Inc., to the Advis¬
Board of the Yorktown Office
Bank
creased
of
The
to
Marine
Company
of
nounced
by
Midland
New
Trust
York
James
G.
is
an¬
Blaine,
President.
the
New
board
York
Avenue
dend
of
payable
trustees
14th
of
Bank
Street,
at
The
8th
New
The
ber
Trust.
firm
of
White
&
Case.
Clifton
W.
❖
*
trustee of the East River Sav-
of
the
N.
J.
Citizens
Collingswood,
Sept.
8,
has
been
the
offices
as
a
The
branch
plans
now
the
of
for
effected
of the
being
the
oper¬
Camden
merger
noted in these columns
Sept. 11. He
on
of age. The Philadel¬
50 years
was
Aug.
said
phia "Inquirer" reporting this
Wambolpl was a past officer
Mr.
Corporate Fiduciaries Asso¬
of the
ciation of the Pennsylvania Bank¬
*
Three
promotions
tirement of
a
A.
William
the
and
re¬
veteran bank officer
announced
were
News
Service
tain control of men's minds.
are:
No matter which major political
party goes into power next Janu¬
ary,
Mr. Irwin said, there is a
positive though admittedly dan¬
(1) To dis¬
seminate in¬
chemical
on
sci¬
by increasing
public under-
Sept.
on
18
by
tion
Dr. Walter J. Murphy
standing
of
chemistry's contribution to
human
welfare and progress.
(2) To stimulate
public recogni¬
contributions of chem¬
and chemical engineers to bet¬
ter
McDonnell, President
of First National Bank in St.Louis.
improve
professional and economic sta¬
of chemists and chemical en¬
gineers.
Manager of the
(4)
To provide information
department,
was about the American Chemical So¬
elected
Assistant
Vice-President ciety and its aims and policies,
and
Manager of credit depart¬ with a view to extending its in¬
credit
ment; William E. Feld of the per¬
sonal loan department was elected
Assistant
F.
Leo
ment;
in that
Cashier
Ryan
depart¬
elected
was
Assistant Cashier and
manager
Oct. 1,
when the present manager,
Assistant Cashier,
Walter J. Clark,
its
of
ence
in all
cern
nation's
raise
needs,
the
living
From 1942 to 1945 he served in the
of
U.
the
S.
Army Air Corps. He is a member
of the
St. Louis Association of
Credit
Men,
the
of
and
his
banking
First
with
career
National Bank in 1923 and in 1934
of the staff of
member
a
personal
(7) To educate bankers and
in
vestors
in¬
the possibilities inher¬
ent in sound and
persistent chem¬
(8) To educate
agement in the value of and
for
need
continuing chemical research.
(9) To encourage public service
created that year. Mr.
activities on the part of chemists
who has been active in
and chemical engineers.
banking since 1910, joined the
(10)
To acquaint American
First National Bank in 1919. He
which
was
Ryan,
was
Assistant
made
the
savings
is
of
Mr.
retires
He
was
a
Banks.
Oct.
1,
of
of
teller in the old
a
number
Third National Bank of St.
from 1903 to 1919,
Bank
in
1919
1921,
when
St.
Louis
he
from
became
chief clerk in the savings depart¬
ment. He
with
youth
importance
elected manager
the true nature
of
competent
most
and
type
of
the
Dr.
Murphy
ten
discussed each of
objectives
of
the News
Service in considerable detail. The
relationship of the Society's pub¬
as
they affect public re¬
was
also discussed. Finally,
lications
lations
❖
Penn
National Bank
the
relationship of the News Serv¬
department in May, 1942. He
ice
at
is
former President
was
*
Stockholders of South Philadel¬
phia National Bank
of
the
*
and
Central-
of Philadel-
a
Continued
of the Savon
page
38
scientists.
progressive
businesses
and institutions have been aggres¬
sive in
research, technological im¬
provement in production, and in¬
more
more
efficiency in distribution,
and
their
they will improve
relations and work
more
public
energetically toward the
es¬
tablishment of policies which woo
the support of additional segments
of the masses.
local
the national level and
sections
Richard
to
A.
Newson &
on
Industry
Aszling,
of
Earl
Co., New York, spoke
"Why Public Relations for the
Chemist?"
He
basically,
the
chemist
should
pointed
out
that
f
|
con¬
cern
himself
with
public
relations for
the
same
that
rea¬
ev¬
else
should. Public
opinion
vital
is
a
in
force
soci¬
today's
ety, and indi¬
viduals
and
institutions—
Richard
A.
Aszling
including
chemists
and
and
divisions
explained by Dr. Murphy.
prosper.
young
and women to the profession.
men
the
essen¬
the chemical pro¬ chemistry—must acknowledge that
fact if they would survive and
fession, in an effort to attract
Louis
and in the First
National
to
1942.
Institute
American
of
Savings
Louis
St.
Banking classes for
years.
the
of
who
attended
in
department
President
Clark,
Manager
as
as
industrial man¬ erybody
department
loan
educators,
son
Robert ical research.
Morris Associates. Mr. Feld started
public, there¬
absolute
an
Value
To promote the expansion
of the chemical industry, meet the
bank's pen¬ standard, and provide more jobs.
Heidell began his
(6) To condition the public to
banking career in 1920 as an office
accept new chemical products with
boy in the First National Bank. full confidence.
department
becomes
to
business, education, the
professions. A properly informed
public may well prove to be our
greatest asset—as businessmen, as
(5)
plan. Mr.
finance
tial
public matters of direct con¬
to chemists and chemical en¬
will retire under the
sion
fore,
of gineers.
savings department, effective
the
therefore the influ¬
individual members—
fluence—and
nationaliza¬
With nationali¬
follow. An informed
creased
Walter A. Heidell,
bank's
toward
industry.
Just
(3) To strengthen and
tus
of
zation of industry the subjugation
of the individual always seems to
living.
the
trend
gerous
and tech¬
ence
nology, there¬
ists
*(•
V
by
tion of the
/
Association.
ers
Association
14, page 572.
Phalen,
newly
elected President of the Michigan
Bell Telephone
Co., has resigned
as a
of
were
«
Of
*.
of
Citizens National
ated
divi¬
stockholders
*
Bank
Camden,
as
law
the
by the Camden Trust Co. of
was announced on Sept. 22
by the President, Richard L. Maloney, Jr. Mr. Gifford is a mem¬
the
of
stock
Trust Co. of West
Chester, Pa. died
He
to
absorption
National
N. J.
20%
in¬
$250,000
result
a
a
Conn,
from
Sept. 8.
*
York,
of
as
of
*
Savings
and
capital
$300,000,
record
*
Greenwich,
its
declaration
The election of John A. Gifford
to
in
County
the
.t
As of Sept. 12 the First National
Matthews, Treasurer of Stern &
of the National Bank of Ches¬
became
Williamburgh."
Stern
cer
asso¬
mortgage administrator
Also
career
Phenix
Dime
Offi¬
ter
&
the
of
formation
*
*
*
James K. Wambold, Trust
in
Co.
became
Mortgage Servicing Depart¬
with
the
Metropolitan
Trust
Company which later merged with
Chatham
he
The
with
ciated
Phenix National Bank in 1920 and
Trust
Brooklyn
1941,
Philadelphia Advisory Com¬
South
mittee.
has
he
and
will become a director of
the
tional,
Central-Penn and Chairman of
transferred
served in various capacities in the
ment.
Appointment of Harold Philips
Trust
Mr. Morse entered
Secretary.
Accounting and Mortgage Depart¬
dent in 1951.
and
ant
the employ
were
the
was
Mr.
Aszling
remarked that in
achieving a
the important task of
favorable
climate
of
atti¬
the chem¬
public
tudes in which to work,
ist
has, on the one hand, a head
over others.
His daily work
is an action of the type which peo¬
start
ple approve, he is busy making
things better, maintaining and im¬
proving the standard of living,
and promoting general
security.
This is
which
it
is
forward-looking activity
popular favor when
understood.
On the other
a
wins
Volume 176
Number 5154
The Commercial and Financial Chronicle
...
(1125)
hand, the chemist is also at
a
dis¬
advantage
-
wise
because
public
of
-
relations
obstacles
communication.
to
His
effective
entific
terms
like
are
is
work
mystery to most people.
life.
foreign
a
remote from
are
Before he
daily
communicate
can
Elect New Officers
a
His sci¬
tongue. Many of the major results
of his labor
Municipal Bondwomen
At
Municipal
annual
meeting
Bondwomen's
of
the
Club
New York Mildred Johnson of
P.
Lang & Co.
dent,
effectively
the
was
succeeding
of
F.
elected Presi¬
Frances
Weller
with the public, he
Isengard of Harry Downs & Co.
interpreter. These obsta¬
Ruth Mill|r of Lee W. Carroll &
cles are not insurmountable, how¬
Co. was elected Vice-President,
ever.
By recognizing the job to be
succeeding Sara Pardy Powers of
done and taking steps to
needs
an
done,
start
get it
R. D. White & Co.; Jean M. Davies
chemist with his head
of Wainwright, Ramsey & Lan¬
the
achieve good public rela¬
can
tions.
tary,
succeeding
Jean
Schwarz-
Elected members of the Board of
Governors
were
Anna
F.
industries
of
Mitchell
&
Shows Its Shove!
Schrei-
Pershing,
institutions
which it is
of
part.
a
products. Thew (Lorain)
Company, the world's larg¬
and
Alice
asserted, will be caster was elected Treasurer, suc¬
ST. LOUIS, Mo.—Richard E. St.
chemistry and to the
ceeding Grace Zvonik of Laidlaw Clair has been added to the staff
and
Shovel
est manufacturer of power cranes
and
shovels,
was
founded
by
Richard Thew, a Great Lakes
Ship
Walston, Hoffman & Goodwin,
Dooley of Ira^Haupt & Co.
Captain, and has been largely re¬
members of the New York Stock
Continuing
Governors
will
be
sponsible, as both the display and
Exchange, furthering its policy of movie
Frances Weller
define, for the development
Isengard, retiring
demonstrating the wares of listed of combustion and
electric pow¬
President; Elsie T. Schuyler of
corporations, presented four con¬ ered cranes and shovels
Chemical Bank & Trust
since 1927
Co., and tinuous 25-minute
showings of when
Thew
Mary Varley of Harriman Ripley
produced
its
last
Thew Shovel Company's techni¬
& Co., Inc.
steam motivated product.
color documentary, "Sidewalk Su¬
perintendents," Sept. 24, in the
With White, Noble
firm's
1370
Slayton Adds
Broadway
branch,
(Special to The Financial Chronicle)
New York City.
(Special to The Financial Chronicle)
ber
This, he
beneficial to
related
Walsfon, Hoffman Go.
waelder of W. E. Hutton & Co.
DETROIT, Mich.
The investment firm is current¬
White, Noble
Building. He
Charles
E.
&
The
group
sale
Monday
on
won
competitive
its bid of
on
101.962%.
Proceeds
from
the
sale
of
the
bonds, plus proceeds from the
cent sale of preferred stock
re¬
by the
company, will be used to pay
term bank loans
725,000
short
aggregating $14,-
incurred
for
purposes, and to
the
construction
construction
finance
part
of
The
program.
company plans
construction ex¬
penditures of approximately $113,^
420,000 in its 1952-1954 construc¬
tion program, and of
the total
amount, it is expected that about
$32,940,000 will be spent in 1952,.
$42,590,000 in 1953 and $37,890,000
in
1954.
/
;
bonds will
The
,
,
be
redeemable
at
prices ranging downward from
105.43% to par. Sinking fund re¬
demptions
will
recede
from
102.47% to par.
Duquesne Light Co. is engaged
purchase, transmis¬
sion, distribution and sales of elec¬
in the output,
tric energy.
A subsidiary of Phila¬
Co., the company serves
delphia
an
of
area
approximately
817
embracing the city
Pittsburgh
and
surrounding
municipalities in Alleghany and
Beaver Counties,
Pa., with a pop¬
miles
square
of
ulation
the
of
1950
1,550,435, according to
census.
A. A. Tibbe Adds
(Special to The Financial Chronicle)
ST.
LOUIS,
Steiner
A.
A.
has
Mo.
joined
Tibbe
&
—
Myrtle
the
Co.,
R.
of
staff
506
Olive
FUELING...
Street.
.
'
.
'
'
,
'
f
.
■
.
Joins Bache Staff
(Special to The Financial Chronicle)
tor tan
GASTONIA, N. C. —William B.
Williams
with
has
Bache
affiliated
become
&
tight
or a
Co.
Two With H. B. Cohle
(Special to The Financial Chronicle)
At the
CINCINNATI,
Emigh
Ohio — O. R.
Henri Schnabl have
and
become
associated
Cohle
schoolground
or
Co., Union Trust Build¬
ing,
&
members
of
with
the
and Midwest Stock
H.
B.
G.
same
with
Prescott
B.
He
Cohle
Latscha
was
&
&
&
Co.,
Carew
formerly with H.
Co.
and
ST. LOUIS, Mo.—John W. Brodbecome
affiliated
with
Newhard, Cook & Co., Fourth &
Streets, members of the
Olive
New
York
Exchanges.
a
industry... with
than
Stratojet. Despite the
may
have
come
miracle worked by the petroleum
an
assist from chemistry.
j
major chemical companies—today supplies
ever
processors
and
Midwest
-
Stock
,
j
with
more
basic chemicals
before... such products as caustic soda,
ammonia, sodium chlorite, sulphuric acid, diethylene
from the
Mathieson—now in its 60th year as one of Amer¬
ica's
petroleum
a
Transforming crude into such varied
types of fuel is
i
a
thimbleful for
j
f
t
glycol, triethylene glycol, dichloroethylether.
A dependable
materials is
requires
to
source
of supply for essential
always important. If
any
of these chemicals,
your
raw
production
you may
be able
buy to better advantage by consulting with
now.
Mathieson Chemical
3, Maryland.
Frederic
Joins Newhard, Cook
has
oil well.
fuels, both
a
Co.
(Special to The Financial Chronicle)
erick
tanker load for
only
Closely associated with the petroleum industry,
CINCINNATI, Ohio—Lawrence
Gessing has become associated
Tower.
or a
difference in
Exchanges.
(Special to The Financial Chronicle)
,
model
Cincinnati
Lawrence G. Gessing Now
With Prescott & Co.
in the stratosphere, flying
takes fuel... whether it's
Mathieson
us
Corporation, Baltimore
Buhl
formerly with
Bailey & Co.
Inc., yesterday (Sept. 24) offered
$14,000,000 Duquesne Light Co.
3%% first mortgage bonds, series
due Sept. 1, 1982, at 102.422% and
interest.
Lewis Ro-
Company,
was
Kuhn, Loeb & Co., Union Secu¬
rities Corp. and A. C. Allyn & Co.,
award of the bonds at
—
wady has become associated with
ly featuring a Thew Shovel win¬
display, its 20th in a series
& Co., and Dorothy Root of F. S. of Slayton &
Company, Inc., 408 that has
incorporated
a
wide
Smithers & Co. was elected Secre¬ Olive Street.
range, of industrial activity and
dow
Banking Group Offers
Duquesne Light Bds.
accrued
17
Commercial and Financial Chronicle
The
IS
Thursday, September 25,-1952
....
(1126)
Question: Do you think it
The Election Prospects
not
FARLEY
By JAMES A.
Maine and Ver¬
Well,
not
go to the polls
indicate in November.
Democratic
go
leader maintains as crucial determi¬
victory the fact that more people are better
present
here
we
column in a
Maine did go
in
and
in power,
The War Factor
and I
may
definitely.
know
It
may
talk about
attempting to defend* the wrong¬
anyone in public life.
Most of those people who have
done wrong—I say most of them—
have
have
have
do with it.
But I
heard General Eisenhower, Gen¬
eral MacArthur, and many men
something
not going to
doing of
gubernatorial something to do with it. I do not
election.
too. I do not like to talk
20 years ago,
happened, but they had their
troubles, too. I say that without
you think the Korean war has to
do
with4|ie fact that many of these
will £ver see people have more money in their
the Democratic
a
am
what
Farley, what do
Mr.
Question:
Democratic in 1932
in
1934
It hap¬
pened when the Republicans were
and so
about what happened
in
in
pockets, and so on?
national election. But
Answer:
Well,
it
those States go
housed, better clothed, better educated, and generally better
off than they have ever been before. Disapproves of Acheson's
reaction to the Hiss conviction.
to
Government.
the Federal
And I believe they are
that exist.
1932; they did not go Democratic
in 1936; and I doubt very much
whether in the lifetime of those
Former Democratic party
of Stevenson
did
mont
towns, and in villages. I am sorry
to admit that it has happened in
things that we talk about are quite
well satisfied with the conditions
going
in 1952?
Answer:
Democratic Committee
Former Postmaster General of the United
States
Chairman of the Board, Coca-Cola Export Corp.
nant
go
that way
Chairman, National
Former
is pos¬
that did
Democratic in 1936 to go
the two States
sible for
to
indicted
been
ecuted,
being
or
in
are
and
the
by
prosecuted
pros¬
course
of
Democratic
for me to answer
United States District Attorneys
May I say in passing that if the
sincerely
that Democratic organization had ex¬
because there are no Republican
is going to erted what I felt was a proper
District Attorneys around.
high in military circles and in
win. Let me say this in passing. amount 0f influence in Maine in
Question: Mr. Farley, how could
Farley at a dinner meeting of
governmental life in this country
I have a great deal of admiration
pasj. eiection they might have
the National Industrial Confer¬
say that President Truman had no anyone take an active part in this
for the distinguished General who been at>ie t0 elect a Democratic
ence
Board
in
the
Waldorf
other course to follow than the campaign without understanding
is
running
on
the Republican Governor there. But they missed
Astoria Hotel in New York City
course
he did.
I would not at¬ the economics of this country?
ticket, and I would be the last in the boat
on Sept. 18.
Answer: Ninety-nine people out
tempt to stand up here and defend
the world to say anything un¬
the conduct of the war.
I do not of a hundred take sides either for
Very frankly, I am not going kindly about him.
Attitude Toward Hiss
knew whether it has been con¬
the
Democratic
or
Republican
to attempt to discuss economic is¬
I believe our side is going to
Question: Mr. Farley, do you
ducted satisfactorily or not.
For party without being too well
sues
because I don't profess to
that reason I am not going to say versed in the economic issues.
ohmit thpm
T am
win desPite the
excur- COndone the Secretary
known anything about them
am sion in the South. Those fellows not turning his back on Alger
that it has not been carried on
I am a firm believer in majority
ot harda sort of hard
Following
is
made it possible
partial tran-
a
believe.
I
that.
script of an audience questionand-answer
session with Mr.
•
Stevenson
Governor
of State
General's
-I
are
busi¬
headed
i
^ going {Q vote the
States
border
the
are
in
who has been
far as JJ1® Republicans are con- stupid answer he gave. I think
cerned- We could get Montana, he
bave sa^ that he felt
cou*d j>e* Arizona, New Mex- sorry for Mr. Hiss or anybody else
ic0' Nevada, Missouri, Massachu- wbo might have been in the pre-
pol30-
itics
for
odd
years
or
Vad
iaa
.
their Democratic
fun,
and thorough¬
there advised
ly enjoyed all
experi¬
I
ence
That
ernor
in
government
and in business.
think
don't
I
bad
as
as some
things
quite
are
I might start out
make it appear.
this
in
that
people
more
better
the
make
to
going
I think
campaign,
admitted—at
be
York
the
So I
t 0
nonn-
hurt Gov-
am
college;
and
these people, in my
despite the mistakes
of
plenty
judgment,
that
inat
down
the
nartv
party
mv
my
arp
are
mav
may
through the
of
ot
errors
Answer: I
Answer: Not being an
right here and now, Mr.
Chairman, going right out on a I cannot answer
ment on Texas?
have
nave
Despite
years.
omission
omission
made
made
and
and
com-
conscience
(and
there
are
a
lot
of
Chief, Chemistry Division of the National
American Chemical Society of futile
efforts of Dr. Fritz Haber, German Nobel Prize winning chem¬
Bureau of Standards, tells
that one. May I
I shall never for¬
Paymenls
ist, to
for
vote
running
a
on a
recover
gold from
ocean
*
couple
Dixie-
Edward
Dr.
which
j
wnic^.
the
for
candidate
of
.
,
think
in those days
finally terminated.
the
German
Government
was
r
played impor¬
tant parts in
the
one
of
most
fabulous
as
that
in this country
ods
What Will We Use for
Money?
Question: Mr. Farley, you said
up until now you base your
that
whole premise of the Democratic
were
The record of
constitutes a most fas¬
cinating story.. ,
,
,
"The work began with the de¬
termination of gold in a number
of samples taken from the North
Sea and a few elsewhere, all in
these years
.
>.
before the investigation was
years
the
anyone
-
chemist, and
todayhowwould you
the
electlon?
the there isn't
.
Prize winning
d
Question: Mr. Farley, do you
think that just for the good of
ment will only go to the polls in getting the Commies out of WashNovember, desoite -all these eco- ington that it is time for a change?
vote
'
get
a
May I say to you
-
Chief of
national
me
Answer:
following World War I.
T
Wichers,
including
J?
Ls®y.fe„vt™
could §etifcorn mnldcomparable
to a eet wheat
anH
then, the same people in my judg- not
nomic issues that are raised, and
Having participated
will admit to you that
.
Now,
of
pos¬
bring auout
tne
Governor Steven¬
with a margin of profit and un-.
the
Chemistry Division
of the dertook the project, in preference
Federal budget was, as I recall, National
Bureau
of Standards, to several other large-scale entertold the American Chemical Soci- prises, as the one most likely to
stabilize Germany's economy and
at
fost 0 government,
in¬ ety on a din¬
to pay off the billions of repara¬
ner
Sept. 17
terest and everythingour
on else. FDR in Atlantic
tions demanded by the Allies. He
iH
«Nnw
Tim
if
wp
„an
0pi
we
can
picked 14 assistants and with this
City, N. J.,
i ' Now, Jim, if we can
team worked for seven or eight
how a Nobel
things that happened that I won't
attempt to defend), a great im¬
better if he was elected.
to
A Wild Goose Chase
we
dls^inguisheTcandidate
did
Dr. Edward Wichers,
*
inose days was
^mocr
runwng on a Dixie soirething betweencould boost bil57 and 60 this
crat ticket,ts but
the ladies will linn rioilarq "if
nardon
if I sav thev are eoin<*
? dollars, it we could ooost tnis
Par?on me J1 „ saJ inef are g°. = national income to 75 billion dolto have
for
line, and I did all I
could
nomination
a
h?11 o£
time voting lars> why> we would get along all w i 1 d-g o o s e
Republican President in my right and we would meet the na- chases in his¬
judgment, inasmuch as Truman jjnnai jpkt'i
tory.
In the
carried that State by a half a
Dr. Edward Wichers
In speaking of the national debt,
hope of sta¬
provement has taken place, great million in round figures in the
I think it is fair for me to say
bilizing the
things have. happened
in this last election.
to you that approximately 250 bil¬ German "economy and paying repcountry that have improved the
lion dollars—and do not hold me arations demanded by the Allies,
Communist Infiltration Insuffi¬
•well-being of millions of our peo¬
World
War 1,
Dr. Fritz
to the figure—of that national debt after
cient Reason for Change
ple.
has had to
do with the second Haber, who won a Nobel Prize in
Question: Mr. Farley, if you had World War. Do not hold me to 1920, the Washington chemist reThe 1948 Pattern
not been associated with the Demthe figure, but a good portion of vealed, devised a scheme to "mine"
whenthe
ocratic Party over
years> as a that had to do with the expanse part of the 8 billion tons of gold
of the war. Now, how much has calculated to be dissolved in sea
of
the
opposition
was
going businessman
been
expended since the .war, water.
around the country and indicat- vote 111
coming
The Chairman: That isn t a fair frankiy,
"For
a
half-century prior to
1 do1 not know, and I
ing that things were pretty good,
would not attempt to defend that 1920 gold was repeatedly detected
thart he would run them a little question.
in ocean waters and many methsituation.
mission
con¬
I
Gold From Sea Watei-
economist,
we
f.
we
n§ure, ana 11 we could get wneat
ernT°ry tr°m Mississippi, could in {Q Q comparable figure, and if we
running to a* comnarabirfimTre and if we
as Vice-President.
They
a comparable nationaland
boost the figure,
income,"
all
York.
New
__
good shape at
Question: How long do you
insofar as the think this well-being that you talk
nominee is concerned, about can last?
nf nPmorrats
delegate to the
a
from
possibly could do to kocio the
sibly
son.
time
will
motivate Carolina and the f,«
.
aiVr n
will
motivate A
Democratic Goveoinff to vote in
going to vote in the prnnr from Mi^i^inni
ernor
from Mississippi, running
running
There
I was
South in
Farley, do you
mess in Washing¬
ton?
ocratic Party will-be successful in, get in the early days of Mr. Roosethe November election.
velt's Administration one night we
clothed, betQuestion: Would you like a com- were talking about that condition
of the country.
At the time the
election.
November
think there is a
"Mess"?
pretty
better fed,
neonfe
people
are
He made a
Prosperity's Permanence
New
Answer: Yes, I believe that the
despite all the things that same" thing will happen in Texas.
have happened to them as the re- jf you i00k back at Texas in 1948,
sult of the war and postwar diffi- they really hated Harry, and they
culties, there are more of those had two Democratic Governers to
people better off than they have vote for on the Dixiecrat ticket
ever been before.
The well-being the Democratic Governor of North
more
Mr.
Question:
you
ing,
those who
rule.
those
and
ing, despite taxes, despite ration-
01
of
_
limb and predicting that the Dem- say this to you.
generally speak-
ter educated; and
in
Democratic
it
am
is
present
I
all I
statement
are
housed, better
least I
„
Stevenson.
electoral
knew,
vention
Washington
A
States up an(j not a very good statement. I
have a would not attempt to defend that,
pretty good number of votes in
the economic issues that are present
t going to
just add
mathematically
by stating that, in my opinion, no
matter what they may say about
must
isn
So
the
businessmen would
Pe°P|e either
J®
by
disturbed
much
nee.
in
had
politics,
Colonel
as
I
dered'a decision"
Governor, inas:~i_
McCormck
ut
i
/-._i
__
much
the
James A. Farley
HiVament. hp was in.
that minois is not Governor, r?iect
SoinS to inasDemocratic
of
lot
If
not.
or
would say so.
certain statement after the courts had ren-
feel
I
and
Connecticut,
a
properly
in that
convention, being a delegate to
that
convention,
I
feel
honor
there has been trouble in Washbound
to
give him my whole¬
.
,
j think we can criticize all we ington. I would not stand up be- hearted support. Whether I know
this or any other intelligent
want> but tbe courts of the land
anything about the economic is¬
gathering in the United States and
had made a decision. I am a strong defend corruption in high or low- sues or not, that is exactly what
beiiever in sticking with friends,
I am going to do.
station. That happens in cities, in
but j thought that statement of the
Secretary of State was ill-timed
maybe
Rhode Island, and
setts,
Tailor!
punches
puncnes,
that
Answer: I will answer that very
trouble franjny. j thought that was a very
as
active in business and
Repub. Hiss?
I really believe
lican ticket.
fellow
ness
proposed for its recov-
ery," Dr. Wichers explained. "In
spite of some 50 patents that were
issued in this field there is no
record of any successful accom-
great secrecy, because
his Institute
were
Haber and
under the sus¬
picion of the Allies. The results
indicated about 5 milligrams a ton
sea and thus agreed
earlier estimates. The
recovery
process was
based on precipitation with alkali
polysulphide. Less than a gram
0f this reagent, plus a trace of a
copper solution, yielded a precipitate which coagulated sufficiently
within minutes to be collected on
sand filters, from which it could
in
the
open
with the
proposed
washing.
Additions of gold to synthetic sea
water at the rate of 5 milligrams a
ton showed recoveries of 87 to
99%.,
"a pilot plant was now constructed on ship board, and with
this Haber and his associates
"cruised the Atlantic. In Haber's
language, 'the outcome of these
journeys was completely and overwhelmingly negative.' Fantastic as
it may seem today, the record
clearly indicates Haber's early bebef that he could redeem a bankrUpt Germany with gold from the
be recovered by reverse
communism than campaign on the fact that people plishment. About 1920 the history
of these efforts was reviewed by
And I believe that sincerely. I I am.
I have spoken that way &re use for off. What are we
better money in the next 20 Haber. He concluded that the best
to
am not attempting to make a camdown through the years. I abhor years?
evidence on the subject indicated
paign speech, but I believe that as the thought of communism.
;
Answer: I do not know, but I a gold content of sea water of persincerely as any statement I have
I will admit to you that there
hope the Lord permits me to be haps 6 milligrams (about a half
ever
made to this or any other was an infiltration in the Governmillionth of a pound) a ton. On
ment. I was not any more pleased around in the next 20 years. I do
group.
this basis Arrhenius, a Swedish
chemist, had estimated the total sea<
Chairman,
quantiy of gold in the oceans at
"Next came the task of resolv8 billion tons.
ing the discrepancies between the
question.
—,
1
say that this Administration, with
At the outset of my statement
"On the basis of 6 milligrams a early analyses, the trial recoveries
Question: Yoti said, General Farbejp 0£ some people on the I said something and I meant it
ton it would be necessary to proc- from synthetic sea water, and the
ley, that a lot of people are going Republican side, has driven those sincerely. I sincerely believe that
to vote for Mr. Stevenson.
You Commies out of the Government, a vast majority, more than a vast ess'250 tons (1,200 barrels) of plant operation on shipboard. It
Democratic Party.
more
opposed to
going
xr
^
didn t
to win.
say
.,
whether he was going r do not think that in itself, frank- majority of . the American people,
•
Answer: I am
•
ly, Is a sufficient reason to change
delighted that you the Administration.
water to
economic problems, despite all the
the
get one
and 5,000 analwith conclusive evidence that the average content of
dollar's worth of ended, some years
but Haber considered that
operation could he conducted
despite high taxes, despite their gold
yses later,
Volume 176
Number 5154
The Commercial and Financial Chronicle
...
(11271
gold in oce#n water is of the order Drexel & Co., Philadelphia, from
micrograms (about a half-bil- 1941 to 1948. He joined The Penn¬
lionth of a
pound) rather than sylvania Company as Vice-Presi¬
of
milligrams
of
ton. When the dream
a
seas was ended by
realization
that
a
dollar's
mining the
the
worth of gold would require proc¬
dent in
1949.
was
elected
was
named
dent in
That
to
the
same
he
year
Board, and he
Executive Vice-Presi¬
February, 1950.
Kelly began his
Mr.
essing, not 25$ tons of water, but
banking
perhaps 200,000 tons, Haber con¬ career with the Continental Equit¬
verted his project to a survey of able Title and Trust Company in
the
distribution
of
gold in the 1925, joining The Pennsylvania
oceans.
Company when Continental was
"In the hands of Haber and his absorbed by the bank in 1931. He
team the ancient art of gold as¬ was placed in charge of the organ¬
saying achieved its ultimate re¬ ization of the bank's Time Sales
finement. It is reported that the Division in 1935, in 1939 he was
•
correction of the earlier
results
not
was
took place
but
erroneous
sudden
a
stepwise,
process
of
magnitude at a time.
ning with the analyst's
fear
of
Begin¬
normal
precipitations
incomplete
and hence
order
an
negative
it
errors,
was
found
that
eaused
positive errors—gold in the
almost
everything
elected
and in
Assistant
1945 he
President
Sales
in
Vice-President,
elected Vice-
was
Charge of the Time
Division.
He
elected
was
SeniorVice-President in February,
1950, and acted
as
Power & Light Co. is
operating public utility en¬
gaged primarily in the generating,
put-chasing, transmitting, distrib¬
Kuhn, Loeb & Co. yesterday uting and selling of electric energy
in Oregon and
Washington,
The
(Sept. 24) offered $7,500,000 Paci¬
PEiila. Bond Club
an
3%% BdSc
To Hold
ing
from
assurance
the weather
company supplies electric service
bureau that
in an area of
everything will be
series due Sept.:
approximately 8,600
sunny, the Bond Clubfeof Philadel¬
1-, 1982, at 101.814% and accrued square miles with a census pop¬
intere&Ho yield 3.65%. Award of ulation of approximately 750,000. phia announced details of its 27th
annual field day to be held
The c'ortipany's main
the
bonds was made to
Sep¬
power system
Kuhn,.
Loeb, bidding alone, at competi¬ forms an integral part of the inter¬ tember 26 at the Huntingdon Val¬
tive sale on Monday on a bid of connected Northwest Power Pool, ley
Country Club, Abington, Pa.
which was created to- assure the
101.404%.
Members and their guests will
Proceeds from the sale of the most effective use of all power re¬
have a
variety of entertainment to
bonds will be used for the con¬ sources in the Pacific Northwest.
i.
choose from. For the
struction, improvement or exten¬
brawny there
gage bonds 33/4 %
"
sion of the
Regular
redemptions
the
of
bonds may be made at prices
ning from
104.82%
to
(Special
to
The
Financial
will
ELGIN, 111.—Walter W. Mooney
run¬
while
is
now
range
from
&
gold
connected with F. S. Yantis
and
tennis, and
putting
a
backgammon
and
High¬
light of the day's activities will be
ing.
the
Stock
Exchange.
dust,
and r transferred
from fingers contaminated by the
handling of a watch or a
Each of these sources of er¬
had to be detected and elimi¬
ror
nated before the analytical results
■confirmed
the
ocean-going
I.
"Haber's
operation .of
pilot
the
'
plant.
investigations
did
not
Still
completely end the dreams of min¬
ing the sea for gold. Since 1935
three
United
more
have
been
recovering
and
gold
number
a
States
granted
for
from
fornia.
of
water
sea
scientists
of
further
'expansion is taking
place at CSC's Agnew Plant in Cali¬
patents
means
have
considered the problem apparently
in ignorance of Haber's work."
of
Here the program
than
more
W. L. Day Pres. of
blueprint
doubling the production
petrochemistry is just
part of the picture at Commercial
Solvents. CSC is still
Pennsylvania Go.
The Board
Directors of The
of
for
'I
expansion
field
source
II
x-xfev
H pi!
I MM,
ipp I
i
i
-
"■
of CSC's activities
an
even
years
more
a
At
the
important role in the
our
Terre Haute,
Indiana, Plant
and
a
major
time
is already under way at
high.
all-
an
and
animal
and
capacity at Peoria, Illinois, with the
all these
at
production of Ammonia and Meth¬
development of
anol from natural gas.
markets for these versatile chemicals.
,
new uses
and
new
crystals.
pharmaceutical,, agricultural chem¬
Output of Nitroparaffins continues
Sterlington, Louisiana, to double
derivatives, Acetone, and
Add to this CSC's activities in the
ical,
-
as
derivatives, Ethyl Alco¬
bulk Riboflavin
production of Methyl'amines from
petrochemicals has reached
ahead. A $20,000,000 expan¬
sion program
£..
leader in the
a
supply for such products
i if
key part
today and will play
of
Butanol and
:
''
hol
PETROCHEMISTRY is
William
of fermentation
■ft.
Pennsylvania Company for Bank¬
ing and Trusts has announced that
calls for
Formaldehyde by the end of 1952.
Of course,
in the
the
nutrition,
automotive
potable spirits fields. Together
product divisions establish
sound, broad base for the
com-
oany's development in the future.
William F. Kelly
Day
NOW
has
Kurtz
William
Fulton
signed
•
•
•
6
CSC
PRODUCT
DIVISIONS
President, but will re¬
Chairman of the Board
main
as
as
officer
senior
the
and
in
re¬
active
affairs.
Day, Executive Vice-
direction of the company's
William L.
and
President
elected
was
February,
since
President
Officer
Administrative
1950,
Chief
of the
*'
i. //J/'//''/f',
//'
'' /i
bank.
Kelly, Senior Vice-
F.
William
President, was elected Executive
Vice-President and will continue
charge of the bank's loan and
in
credit activities.
Mr.
Kurtz,
prominent
long
in
INDUSTRIAL CHEMICALS
PHARMACEUTICALS
AGRICULTURAL CHEMICALS
Butyl, Ethyl & Methyl Alcohols &
Antibiotics-Penicillin & Bacitracin,
Commercial-grade Ammonia, Nitrogen
.Solutions, Insecticides-Benzene
Derivatives-Nitroparaffins &
Derivatives-Riboflavin, U. S. P.
-
local and national banking circles,
Veterinary Products, Hypotensive
Products, Lipotropic Agents, & Blood
Volume
Hexachloride & Dilan®
Expander
has been President of The Penn¬
sylvania Company since January,
1938,
and
Chairman
Board
January, 1951.
He
was
since
President
of the Colonial Trust Company, a
to which he
post
when
1918,
that
with
merged
institution
the
he
merger
named
Director
and in 1934
company,
T
Mr.
Day
as
a
WMk
; ,//,■/
in
tin
was
Vice-
of
the
ivW&i
began
his
ANIMAL NUTRITION PRODUCTS
AUTOMOTIVE SPECIALTIES
Antibiotic Feed
Peak® &
Supplements-Baciferm,
Nor'way® Anti-Freeze,'
elected
Duoferm & Penbac, Vitamin Feed
Radiator Chemicals &
Supplements-Riboflavin & Choline
was
Executive Vice-President.
career
y
4
y</'
At the time of
was
and
f>,,A
Pennsylvania
The
Company in 1930.
President
elected
was
s,
% wf
,&■//
POTABLE SPIRITS
Neutral
Spirits & Whiskies;
Other Automotive Products
Rackhouse Barrel
Storage
business
junior engineer with
Day and Zimmerman, Inc., Phila¬
delphia,
a
to 1935.
He
syndicate
Stanley
1936
to
post he held from 1931
was
officer
&
statistician and
a
with
Morgan
Co., New York,
1941,
and
a
from
partner
of
COMMERCIAL
SOLVENTS
CORPORATION
GENERAL OFFICES: 260 MADISON AVENUE, NEW YORK 16, N. Y.
tournament,
bridge.
air-borne
casual
for
interested in less strenuous
games.,
Co., Incorporated, Tower Build¬
par.
be
those
Chronicle)
par
to
redemptions
101.82%
With Fr S. Yantis & Co.
company's facilities.
reagents, in common glassware, in
ring.
Outing
PHILADELPHIA, Pa.—Follow¬
fic Power & Light Co. first mort¬
senior loaning special
officer of the bank.
Pacific
Kuhn, Loeb Offers Pac.
Pow. & Lt.
19
The Commercial and Financial Chronicle...
20
Thursday, September 25, 1952
(1128)
small
Tax-Exempt Bonds as Earning
Assets for Savings Banks
By ALFRED J.
purchases of tax-exempts by sav¬
ings banks to date is that such
more
Imong savings banks* assels^Mr. Casazza
reasons: (1) recent imposition of Federal income tax
gives as
I
mutual savings banks; (2) accelerated rise in savings
on
.
over
become
the long run,
immediate
less
these
appeal
for
institutions.
de-
a
thing,
one
banks
may
four
least
solid
reasons
deposits, since
to
pay
immediate, prob¬
be more aggressive in
alternative
outlets for lem for most savings banks. Out¬
rather
their funds.
want
will
ers
Corporate
more
capital expenditures
also, it is anticipated, will decline
in the future from the current
to tax-exempt
record
potential
This will tend
porate bond issues offered.
The
Alfred J. Casazza
One reason,
most
high level.
to reduce the volume of new cor¬
as
in¬
vestments.
the
im-
.....
Federal
Government, it is
true, has resumed deficit financ¬
'
ing
now
that the defense program
Hitherto, mutual sav¬
ings banks received no tax bene¬
fit from holding bonds, the inter¬
est on which was exempt from in¬
Now,
tax.
come
savings bank
a
tax
income subject to
which has
slightly higher net
return from a tax-exempt bond
yielding 2% than from a 4% tax¬
able mortgage, since income from
the latter could be taxed up to
realize
may
52%.
a
.
A second reason
for the greatly
interest among savings
bankers in tax-exempts is the ac¬
increased
de¬
posits. The gain in savings depos¬
celerated
growth
of savings
promises to be one of
the largest on record, comparable
to the spectacular increases dur¬
ing World War II. In fact, the
dollar gain in savings bank de¬
posits for the whole country dur¬
ing the first 7 months of 1952 was
larger than during each of the full
calendar years 1947 to 1951, in¬
clusive.
Should this rapid deposit
its this year
growth persist, the finding of suit¬
able investment outlets in ade¬
quate volume could well become
the most pressing problem con¬
fronting mutual savings bank
managements.
factor
third
A
is the prospect
that the supply of certain invest¬
fall short
demands.
This
ments in the future may
institutional
of
holds
for
true
mortgages.
With
decline in the rate of family
the
from
formation
the
abnormally
high level of the war years and
early postwar period, demand for
new homes is likely to remain for
some
dwelling
United
time,
at a lower level than
States.
At
the
same
bonds
pay¬
bonds
will
become
available
in
larger volume in the years
ments
received
on
outstanding
ahead, at the very time when other
mortgage loans offset a large part investments will be in shorter
of the new mortgage loans that
supply, alone would justify keener
are being made by each bank.
It interest in this class of invest¬
is probable that, over the next few
ments
by the mutual savings
years, the annual net increase in banks of the
country.
outstanding urban mortgage debt
Purchases Moderate to Date
may not average much above half
the $10.5 billion achieved in 1950,
Purchases of tax-exempt bonds
the record mortgage lending year.
by mutual savings banks have
Suspension of Regulation X could been modest in volume
to date,
give a renewed fillip to home
despite greatly increased interest
building.
However, the backlog in
of
demand
been
59th
for
new
homes
Annual
by Mr. Casazza before the
Meeting
of
the Savings
Banks Association of Maine,
N.
has
greatly reduced by the resi¬
*An address
H., Sept. 23,
obligations
exempt
Portsmouth,
1952.
not
only varies greatly from
institution
another, but
change materially from one
may
year
to the next.
Let
us
take a bank with $10,000,000 of deposits that has sur¬
plus and reserves, as computed
pri¬
vately held today exceed $25 bil¬ for
-
one
to
tax
$1,250,000.
of
purposes,
bonds
as
class. But it is obvious
a
its surplus and reserve ratio, now
the
to
new
ance
of
would
buyers
for
indicated
extent
projections
issues
future
have
to
among
by these
financing,
be found
life insur¬
companies, pension funds and
other classes of investors who de¬
rive little
or
no
benefit from tax
an
tors in
this group.
Some of the recent
turnpike is¬
mortgage commitments sues were
priced on a basis high
institutions are adequate
enough to attract insurance com¬
to provide outlets for new funds
pany
and pension fund buyers
for some time to come. The cur¬
who have little if any interest in
rent Volume of Jnejw corporate tax
exemption. This meant that
bond offerings is large, furnishing
yields on such tax-exempts were
both savings banks and life insur¬
comparable to those provided by
ance companies with a good sup¬
of many
ply of such investments.
But the chief reason why tax-
corporate bonds.
If the
supply of tax-exempts is
to expand in time to a
exempt
tractive
tributed
longer
they
earnings would
subject
be
to
then
no
taxation
if
added to reserves, and
tax-exempt bonds would become
are
much
less
desirable
this
on
ac¬
count.
Obviously,
to
cease
Federal
income
soon
subject
to
taxation will not want to
its
base
bank that will
a
have
investment
policy on
taxes.
It is not
only the immediate tax position of
a savings bank, but also the prob¬
able changes in its tax liability in
minimizing
the
its
foreseeable
future, that will
desirability of tax-
determine the
bonds for investment
exempt
of
its funds.
For the bank that has
and
ratio
reserve
of
surplus
a
well
over
12%, whose management is
fident that the ratio will
above
con¬
be kept
for the indeterminate
12%
have
future,
tax-exempts
greatest appeal.
the
Alternative Investments Available
Some savings banks, because of
location, organization and policy,
have
available
supply
them
to
desirable
of
a
larger
mortgages
than do other institutions.
A
mortgage
giving a return,
4% gives al¬
yield, after a
after
expenses, of
most the same net
52%
tax,
as does a tax-exempt
yielding
2%.
True,
the
mortgage is less liquid and may
involve a higher risk element. On
the other hand, the mortgage is
bond
not
similarly vulnerable to price
depreciation
exempts
income
tax
of
in¬
an
supply of tax-
future
or
rates.
the bank at
no
because
in the future
crease
reductions
Also,
in
should
future time have,
some
income tax liability, the mort¬
would then become far
gage
more
suitable from the
yield standpointHence, a bank that has available
to it an ample supply of relatively
high-yielding mortgages may be
less
interested
this
time
only
limited
outlets
in tax-exempts at
than
others
that
mortgage
have
lending
available.
Another
important considera¬
a savings bank can
and will purchase preferred and
tion is whether
common
stocks.
received by
titled
to
Dividend income
corporation is en¬
tax credit of 85%,
a
a
which leaves only 15% subject to
the normal and surtax rate of
52%.
This makes the net tax rate
applicable
to
dividends
received
to
much
amortization
heavy
Tax
Status
Under the existing revenue law,
the tax status of savings banks
Beginning with 1947, new tax- vidual
finance the con¬
savings banks at this time. by a bank only 7.8%. Thus, a sav¬
struction of industrial plants to exempt financing has exceeded $2
In the future, it may well be ings bank can largely reduce its
billion annually and it rose above
be leased
to
that tax-exempt obligations will tax liability if it can and does
private operators.
Laws now on the statute books $3 billion in 1950 and 1951. This have a broader appeal for savings purchase
equities, and there is
year,
new
tax-exempt offerings banks. This would be true
call for a
then
their
in 1950, when
the
than
large volume of taxhave been at an annual rate in
almost 1,400,000 new exempt public housing bonds.
excess
of $4 billion.
Investment
units were started in
The possibility that tax-exempt
bankers
who
have
successfully
years
during the coming decade.
bonds appear more at¬ going
as a future,
rather than point where such offerings must
be priced to attract investors not
a
current, investment for most
mutual savings banks is the huge subject to income tax, would-be
increase in the supply of such ob¬ purchasers of municipals among
persist, the Treasury may
ligations that looms ahead. At the savings banks are well advised in
prefer to finance ther^i mainly
present time, there are about $25 going slowly about making new
with short and intermediate term
commitments in this field. Since
billion of tax-exempt bonds held
obligations, rather than with new
by private investors like individ¬ tax-exempts may become avail¬
long-term bond offerings designed
able to them on a more attractive
uals, banks and insurance compa¬
for investing institutions.
relative basis later on, delay could
There nies.
So large is the volume of
has been discussion of a new 3%
mean
that higher yields will be
possible new tax-exempt borrow¬
long-term Treasury bond offering.
obtained and price
depreciation
ing over the next decade or two
Such an issue is likely to be un¬
on
obligations purchased now
that some students of the subject
dertaken only when a sizable de¬
would be avoided.
expect the amount outstanding to
mand exists for it among invest¬
Any future reduction in income
increase severalfold.
Many fac¬
ing institutions, and if the Treas¬
tax rates would also tend to de¬
tors, political and economic, could
ury does not expect a decline in
press prices and raise yields of
affect the actual rate of growth of
business that would reduce inter¬
tax-exempt debt, but the proba¬ tax-exempt bonds. Buyers of these
est rates. Furthermore, additions
bonds are always comparing the
bilities all favor quite a
sharp
to holdings of Treasury obligations
rate of return on them with that
rise in the total. Such a large in¬
are relatively unattractive for sav¬
which can be obtained from tax¬
crease in the supply of these bonds
ings banks beyond the total de¬
able bonds.
The lower the tax
will tend to make
yields more
sirable for liquidity purposes and
rates, the higher the yield that
generous to attract sufficient buy¬
to maintain a proper ratio of sur¬
a
tax-exempt bond must give to
ers to
absorb the heavy new of¬
plus accounts to risk assets.
make it attractive in comparison
ferings.
A fourth logical reason for the
with taxable obligations.
increased interest in tax-exempt
The Future Supply of
The moderate holdings of taxTax-Exempts
obligations is the likelihood that
exempt bonds of mutual savings
the supply of such securities will
banks today thus provide no real
Old yardsticks are of little use
indication of the extent to which
expand to record levels over the
today in appraising the prospec¬ their interest in such bonds may
next
few years,
far surpassing
tive supply of tax-exempt bonds.
anything witnessed in the past.
expand in the years to come, given
Until 1947, the record year for
More rapid population growth and
favorable conditions for such pur¬
tax-exempt
financing for new chases.
population shifts have created a
vast demand for new schools and money purposes had been 1927.
In that year, $1.5 billion of State
Individual Bank Policy
other public works. Expenditures
and
municipal obligations were
Purchases of tax-exempt bonds
upon highways are mounting spec¬
offered publicly. During the 1930's,
in substantial amount have been
tacularly.
Turnpike
and
other
the volume of such issues declined
made so far only by a limited
tax-exempt revenue projects are
to well below $1 billion a year;
number of savings banks.
giving rise to bond offerings of
This
and in the war years, the annual
is far from surprising. It reflects
unprecedented size. An increas¬
total of new money issues aver¬
the fact that tax-exempts vary
ing number of states and munici¬
aged only $350 million.
palities
are
greatly in attractiveness to indi¬
considering issuing
portant one at the moment, is the is
entering its peak phase. But
Enactment of the Revenue Act of
military outlays may decline sub¬
1951, by which mutual savings
stantially after 1953 if the threat
banks have been brought under
of a world war abates. Even should
the Federal income tax for the
deficits
first time.
$5 billion annual mark
standing
attention
henceforward
obligations
above the
institutions
investing
essarily
seeking
mutual
bank¬
why
savings
huge road building,
school, sewer, hospital, public
housing and other programs now
contemplated could well bring the
total of new tax-exempt financing
find by purchasing equities where this exemption. In that event, yields
that the volume of new mortgage is permitted by state law.
on such issues would have
to be
loans is insufficient to meet their
Moreover, a shortage of invest¬ raised to a level at which they
ment outlets is still a potential, would
investment needs, they must nec¬
prove attractive to inves¬
other
at
are
is¬
add
tax-exempt
well-founded.
There
bond
But the
sues.
The Bank's Tax
level, not all of them
a
financed with
be
their net that, should the available supply 12^%, will before long dip well
earnings, after dividends, to a bad of tax-exempt bonds be expanded below the 12% level. Its undis¬
these
debt
reserve
without deduction
for tax until their surplus and re¬
bonds dential construction boom of the
serves rise to the 12%
ratio. In¬
for investment by mutual savings past five years, so that it may be
banks is greater today than at difficult to find a market for more dividual savings banks can also
minimize their tax
liability by
any
time since the 1920's. This than a million new dwelling units
realizing losses through sale of
a year for any extended period of
increased
time.
When savings banks and bonds held in the portfolio, and
interest is
in
high
so
would
many
fall short of 12% of
acquire them.
Interest
tain
savings lion, having nearly doubled since All undistributed earnings of this
banks find that they can. solve 1946.
So far, the keen demand bank would
be
subject to the
their tax problem without reli¬ for these bonds from individual Federal income tax.
ance upon tax-exempt bonds. This
and
If this bank's deposits are in¬
corporate investors seeking
is true, needless to say, of insti¬ tax-exempt income has served to
creasing at an annual rate of 10%,
tutions whose surplus and reserves
keep down yields on tax-exempt however, the probability is that
For
,
possible shortage of alternative investments, and
(4) a probable larger supply of tax-exempts in future. Holds
it is still a question whether banks should add materially to
holdings of tax-exempts or await a more propitious occasion to
posits; (3)
.
attractive
haffe
Contending tax-e^&wnpt bonds seem certain to occupy a more
to
likely
while
bonds,
N. Y. City
important place
compared with holdings
States Government se¬
curities, real estate mortgages and
corporate bonds.
The explanation for the limited
CASAZZA*
Vice-President, Savings Banks Trust Company,
as
of United
such investments.
correspondingly less need for
partic¬
such bonds it to buy tax-exempt issues to
were
to increase materially be¬ minimibe the tax. Also, the yield
on
cause of a great increase in the
equities is attractive relative
distributed huge recent turnpike
supply and because of tax reduc¬ to that on tax-exempts, tax con¬
and housing issues freely predict
tion. For the time, however, tax- siderations
aside, and notwith¬
that we are on the verge of $5 bil¬
exempts are far more satisfactory standing the greater risks of mar¬
lion tax-exempt financing years.
to some
savings banks than to ket price fluctuations in equity
If these predictions prove justi¬
investment.
others.
fied, it would mean that investors
There are at least five factors
will
be
called
upon
to absorb
Portfolio Distribution
that a savings bank will want to
yearly more than three times the
A savings bank's
attitude to¬
weigh to determine what its at¬
volume of tax-exempt bonds that
wards
had been offered in the year 1927,
the record
The
year
until 1947.
Municipal Forum
York held
at which
a
of New
conference last June
authorities
in
the
field
ularly
if
yields
on
particular types of invest¬
titude should be towards the pur¬
chase of tax-exempt bonds at
time.
These
this
are:
(1) The bank's tax status.
(2) Alternative investments avail¬
(3) Portifolio distribution.
predicted that expenditures on able.
Holdings of tax-exempt bonds public works by States, munici¬ (4) Willingness to buy issues with
by all mutual savings banks are palities and their agencies could greater risk.
(5)
Appraisal of
now
approximately double the average $10 billion yearly over yield trends.
I shall discuss each of these
$140,000,000 held at the beginning the next decade. It is true that,
of this year, but are still quite though expenditures should at¬ pertinent considerations briefly.
ment
will
influenced
necessarily be largely
by the makeup of its
entire portfolio.
In
the
case
of
a
savings bank
that is liable to pay tax and that
now has invested, say over 40%;
of its deposits in United States
Government securities, a shift into
tax-exempts could increase the net
yield realized after taxes without
*
Volume 176
Number 5154
...
The Commercial and Financial Chronicle
(1129)
impairing liquidity and portfolio whether a savings bank should a basic
policy with regard to in¬
quality materially. But where a add materially to its holdings of vestment in
tax-exempts at this
bank has reduced its United States tax-exempts now, or should await time.
Government portfolio to less than a
more
propitious , occasion
to
25% of deposits, and particularly acquire them in the future. The
where most mortgages are con¬ larger supply of tax-exempt fi¬
ventional, lacking the protection nancing in prospect will cause
-
Chas. Hayden Golf
FHA -insurance
of
VA
or
guar¬
antee, thus giving the bank a
latively low ratio of surplus
re¬
soiqe
these
bankers
bonds
in
to
delafy
volume
Tournament Winners
buying
now.
For
A
four-man golf team repre¬
bank,: its prospective tax
senting Wertheim & Co. won the
counts to risk assets, the argument liability, the
availability to it of 24th
for
anniyal Charles Hayden Me¬
purchasing tax-exempts in good mortgages, the overall port¬
morial Trophy tournament at The
place of Governments is far less folio distribution and appraisal of
The
future yield trends will determine Apawamis Club, Rye, N. Y.
strong.
:
policy towards tax-exempts winning score was a net of 300 for
The overall portfolio distribu¬ its
tion will also
ac¬
determine the ade¬
of current income of a sav¬
ings bank, and hence the relative
weight to be given the net yield
each
the four-man team.
for the immediate future.
Regardless of whether
quacy
bank
decides
empt
bonds
to
in
a
acquire
volume
savings
tax-ex¬
A total of
38
teams representing New York in¬
vestment banking houses
partici¬
pated in this year's tourney.
Loeb
&
Co. which netted
301.
Third place went to Blyth &
Co.,
Inc., with
net
a
Charles C.
Boston
Glavin
Corporation
dends and
adequate annual addition to surplus or reserves
may
less
inclined
to
shift from
an
whether
it
postpones
now,
or
R. L. Day Adds to Staff
(Special to The Financial
Chronicle)
of 305.
score
'
the
of
First
the
won
low
gross score honors with 74.
W. Bartlett of
Frank
Harden; William M. Rex
Clark,
Baker,
Weeks
of
&
BOSTON, Mass.—Cooper
War.
has
become
and
and Boston Stock
& po.; C. Gerard Dodge
Charles W. Snow of Cohu &
Co., and W. E. McGuirk
Loeb
&
Co.
tied with
of
With
Kuhn,
the two-man teams with
Exchanges.
Hayden^ Stone
BOSTON,
Alves
is
Mass.
with
bonds
than
to
Paine, Webber Adds
(Special to The Financial Chronicle)
such
BOSTON,
Mass.
Gardner, Jr. is
Webber,
Jackson
George
—
now
with
&
Federal Street.
-
that
finds it
has little left for surplus after ex¬
dividends
penses,
and
taxes.
Willingness to Buy Issues With
Greater Risk
A wide range of yields is avail¬
able on tax-exempt bonds. A sav¬
ings bank that is willing to invest
in
construction
such
as
pike
offerings,
revenue
of the
some
can
issues,
recent
turn¬
yields
secure
comparable with those offered by
corporate bonds, despite the added
advantage of tax exemption.
On
the other hand, the best
grade
tax-exempts, especially those with
relatively shorter maturities, sell
on
yield
a
basis
low
so
largely discount their tax
to
as
exemp¬
tion advantage.
In this connection also each in¬
stitution will want to consider its
over-all
portfolio distribution be¬
deciding whether it is justi¬
fied in assuming the added risks
incurred by purchasing revenue
fore
and other
tax-exempt bonds with
relatively lower quality ratings for
the
sake
of
the
higher
yields
thereby obtainable.
Appraisal of Yield Trends
The
seen,
known
facts,
as
clearly point to
in
crease
the
Albright station now under construction
by two of our principal operating subsidiaries.
V
have
we
sharp in¬
a
volume
future
of
tax-exempt bond financing. But
only the future can determine how
far
the
of
such
yields
larger prospective supply
investments will raise
and
depress
conceivable
that
a
prices.
It
decline in
is
the
supply of other investments will
so
largely increase demand for
High-Powered
tax-exempts that prices for the
latter may remain
relatively firm.
Moreover, there can be no
tainty that income tax rates
be reduced
the
value
materially,
of
disappointing
In the
cer¬
will
power
so as to cut
tax exemption.
failure
to
deal
of
skepticism
effect
at
judgement that
anything
creased
bonds
supply
now
like
of
the
in¬
Albright, W. Va., with
sion
as
its
tax-exempt
This
regards yield prospects for
of
obligation, and then
Tax-exempt bonds
savings
certain
seem
only the imposition
Federal
est Penn
income tax
upon
in
deposits,
more
a possible
Electric
supply
and
of
on
the
interest
in
part
mutual
of
miles... in Pennsyl¬
kilowatts,
more
than twice
power
Company
supply keeps
pace
with the technological
advance and expansion of industries
operating in
West Penn Electric
territory and with the wider
a
tax-
exempts in the future justify in¬
creased
square
that at the end of World War II. This
growth of
(INCORPORATED)
shortage of
investments
ample
people throughout West Penn Electric's
will exceed 1,700,000
the
of
mutual
savings banks for the first time in
1952, but also the accelerated rise
alternative
,
benefits both indus¬
ginia. The total capability of the System in 1954
investments
in the future than in recent
years.
Not
capability of 135,000
vania, West Virginia, Maryland, Ohio and Vir¬
THE
important place
bank
a
program
territory of 29,000
Conclusions
among
continuing
tries and
accordingly.
to occupy a more
station
132,000 volt
this class
act
a new
combined capability of 150,000 kilowatts and, in
transmission lines.
conclu¬
own
a
kilowatts and b scheduled to be in operation in 1954. Another main
project
now under
way includes construction of 185 additional miles of
in prospect prices will
reach
budget of $48,700,000 provides for
completion of the first two generating units of
yields increased.
In the last analysis, each institu¬
must
customers.
Springdale, Pa., station. Each of these units will have
if
be depressed and
tion
growing needs for electric
part, for the installation of unit No. 3 at that station and unit No. 8 at the
score.
It is my own
we
have
meet the
of its residential, commercial and industrial
the substantial
this
on
six-year period after 1945, West Penn Electric has invested about
The current year's record construction
The
lasting reductions in taxes follow¬
ing World War II has fostered a
good
Growth at West Penn Electric!
$188,000,000 in additional facilities to
use
50
Broad Street, New York
4,
N. Y.
of
electricity in the home.
Y
.
tax-exempts
savings
banks.
There
is
considerable
question
Principal Operating subsidiaries: Monongahela Power Company
•
&
net of
a
147.
tax-exempt
bank
a
James
Stone
Co., 10 Post Office Square.
liquid non-risk United States Gov¬
bonds
A.
—
Hayden,
be
ernment
wit
(Special to The Financial
Chronicle)
Charles C.
Glavin of the First Boston
Corp.
for individual low net
score, each
with a 72. Fahnestock & Co. led
East
affiliated
JR. L. Day & Co., Ill Devonshire
Street, members of the New York
Dodge
The
Charles
Hayden Trophy
Consisting of Allen C. DuBois, was
a new investment
pur¬
donated by partners of Hay¬
Herbert A. Goldstone, Theodore
as
chases until a future date, the
compared
with
its
safety,
den, Stone & Co. and is kept in
W. Hawes and Charles S.
Werner,
liquidity and market stability. bank's management will be well
the winning team edged out the perpetual play as a memorial to
Thus, a savings bank that earns
justified to weigh and formulate second place team from
Kuhn, Mr. Hayden, founder of the firm.
enough to cover expenses, divi¬
obtainable from
21
The Potomac Edison Company
•
West Penn Power Company
P.
Paine,
Curtis,
24
Financial Chronicle... Thursday, September 25, 1952
The Commercial and
(1130)
22
Stock Prices Lower
"For
Warranted!
Than
given temperature than any
any
ful
temperature
polythene. To such represen¬
organic liquids as ethanol,
ethyl acetate, carbon tetrachloride,
hexane, benzene and acetic acid,
the
permeability at room tem¬
prevailing stock
Winkler
Max
Dr.
s/andard-Poor 365 aver¬
of 1938
Dividends for the current
the
by
measured
as
standing at 225*4, are, in terms
dollars, only 24% higher than in 1938.
ages
expected to amount to somewhat more
are
year
E. Ift Morgan
distrib¬
the
divi¬
equal
with
1938
$158.5
$67,4
175.7
96.6
41.5
22.8
24.2'
Wages
taxes
Profits before
Taxes
after
Profits
Standard-Poor
that
announce
which
42.8
125.7
Morgan has
will
3.3
590.9
become
1.0
1,330.0
2.3
313.0
c
t
a
with
d
e
Mr.
First,
Morgan
in
24.0
corporate
At
meeting of 122nd Conven¬
a
tion
the
of
Chemical
American
H.
much
hard aluminum,
resistant to impact than any
more
other
known
as
film,
and
with the
highest electrical resistance of any
known material, was described in
syn¬
lower.
basis
of
tional
area
the
the
tensile
would
be
reduced
at the
du Pont de
Nemours
& Co.,
the
to
synthetic
is
fiber Dacron,
of
the
that
strength
film
of
times
ethylene
greases.
endure
basic
in
"stroke
J.
Dr.
of
film
new
genius"
R.
scientist,
discovery which
the
on
Whinfield,
the
report
re¬
was
an
English
said.
the
is
the
on
of
the
film
that
of
two
three times
to
cellulose
or
before
failure, this poly¬
terephthalate film can
10.000
over
flexes
under
tear
strength
is
consider¬
ably lower than that of polythene,
but
than
greater
that
cello¬
of
Dr. phane or cellulose acetate. Its im¬
pact strength is four to five times
Whinfield, continuing research be¬
gun
in America by Dr. Wallace H.
Carothers. the discoverer of nylon,
selected
for
his
first
experiment
the best combination of chemicals
to
make
was
the
desired
material,
it
of
any
Mechanical
research has succeeded
of
range
as
low
terephthalate.
tains
was
described
as
are
over a
minus
20
film.
rela¬
tempera¬
degrees
centigrade to plus 80 degrees.
as
tensile
film
known
properties
tively unaffected
ture
producing the film, which is
known chemically as polyethylene
in
The
other
embrittlement
stated.
Further
that
above
has
been
100
degrees,
are
the
No
observed
minus 60 degrees.
properties
M1*.
firm's ad¬
relations
business
Alstyne, Noel Go.
Adds
Ogden
Ogden Edwards
Edwards
become
has
associated with Van Alstyne,
&
Noel
Co., 52 Wall Street, New York
members of the New York
Stock
Exchange,
in the firm's
Institutional
Department. Mr.
City,
Edwards
With Kenower,
While
changed
film re¬
degrees.
regulatory restrictions
reasonable
unsatisfactory
and
conditions
itself; one seg¬
is dealt with in
within the business
which
of
article.
your
joined
It is
wall. It
takes no great intelligence to fore¬
see
how disastrous results could
be if the matter of pricing un¬
handwriting
the
—
on
listed securities is
tinue
to
the
allowed to con¬
deteriorate. It is no
less
discouraging
to
note
the lack of foresight on
the
part
of institutional buyers. Per¬
and
surprising
haps they think that regardless of
what
may
happen to securities
dealers, their operations will not
Well, perhaps they are
be affected.
think
affected by
disruption in the investment busi¬
right but I do not think so. I
they definitely will be
and will find it most
ness
difficult,
transact their
unlisted business advantageously.
in
Douglas R.
staff of
Kenower, MacArthur & Co., Ford
has
Bauer
due
course,
had
I
the
to
the
with
experience
an
department of one of our
a
few months ago.
trust
banks
local
Building, members of the Detroit
I refused point blank to be a party
and Midwest Stock Exchanges.
to a transaction when it became a
Baxter, Williams Adds
(Special to The Financial Chronicle)
CLEVELAND, Ohio
—
with
Williams
&
Co.,
Union Commerce Building, mem¬
bers
Baxter,
of
change.
the
Midwest
Stock
In the past he
Hayden, Miller & Co.
was
sidered
the
not
am
abets
services rendered.
interested
in
a
legitimate
profits by giving the business to
with orokerage firms who will accept
it on .almost any kind of terms
an
this order was available
without solicitation on my part as
True,
but
most institutional orders are,
the
experience
anri
with
fffnrt
institutions
in
nrnviHincf
give
time
iispfnl
in¬
than
in
is,
It
most
knows
and
the investment.be handles,
about
commensurate com¬
is entitled to
pensation for his ability and ex¬
perience. His profit limit, never¬
from some
under the code
(6%
5%
is
theless,
investment trusts)
by reputable dealers.
business which I can
call to mind at the moment where
recognized
It is the only
profits have not increased despite
increasing costs.
with what
line
In
I
said
have
previous paragraph, intelli¬
in the
and
gent people go to the ablest
most
experienced
for
sources
legal, engineering and other pro¬
advice and service be¬
fessional
cause
although
that,
know
th^y
than they
elsewhere, in the long
they will be ahead. It is only
shortsighted who think and do
they
more
pay
may
would pay
run
the
otherwise. Therefore, coming
to
situation
develop
of
elimination
the
necessitate
back
should a
which would
theme:
original
my
of the experienced people—
of which there are all too few—
many
the
in
business, I
investment
am
would
find it difficult to invest with the
degree
same
institutions
that
satisfied
of
success
as
they
with the assist¬
experienced investment
have been able to,
of
ance
people.
despite
Furthermore,
the
ap¬
advertisements of large
wherein people are assured
pealing
firms
of
individual attention
and serv¬
not agree that an indi¬
vidual— and
particularly the
smaller
investor — can hope for
ice, I
can
much attention from a "mass pro¬
duction"
more
This will be
come into
operation.
factual when
we
This
depressed and weak markets.
another
point, Mr.
Dutton, which is that it may well
be wondered what will
happen
when such markets occur. I say
brings
up
this because no one
under 40 years
has had much, if any, ex¬
of age
perience in the kind of economy
which
with
we-
may
day
some
again have to contend. Yet, per¬
sonnel in the
as
to
investment business
in most businesses, is
great extent of a
a
which
ence.
not
has
this
In
my
had
comprised
generation
such
experi¬
opinion the lack of
experience is a serious matter
guided
who
investor
any
is
being
inexperienced
such
by
counsel, the results of
which re¬
main to be seen.
nevertheless dealers who do busi¬
ness
way
ability and
more
business.
investment
to
order.
where
means
Ex¬
get
the
therefore, logical to say that the
investment
dealer who has had
business
profit or
an organization fosters and
the
reduction
of
dealer
without
when
compensation inade¬
the
for
I
to
Joins
"meeting price." I con¬
matter of
quate
William
H. Saunders has become associated
useful
properties up to 200
Moisture absorption
is
MacArthur
(Special to The Financial Chronicle)
Hayden, Miller
flexible, tough, less than U.5%, so mechanical
(Special to The Financial Chronicle)
durable, impermeable, and stable properties remain essentially con¬
to temperatures up to 200 degrees sistent over the entire range of
COLUMBUS, Ohio —Harry W.
relative humidity.
Buckley
has
become
affiliated
centigrade."
"The film retains its properties with Hayden, Miller &
"The oriented, crystallized film
Co., 17
has a 'yield stress' and breaking upon prolonged exposure to high South High Street.
"transparent,
done so
ment
DETROIT, Mich.
conditions.
same
"Its
a
the part of
public
and
Inc..
formerly was with Equi¬
acetate.
While
cellulosic
films table Securities Corporation.
can be flexed only a few hundred
highly resistant to water vapors,
solvents, odors, oils and
The
is
Van
cross-sec¬
twice
cellophane
organic
sulted
Co.,
prior to joining the Riecke firm.
breaking point,
about
me
surprising and discouraging
ciated with the Philadelphia office that those in the business are so
of Walston, Hoffman & Goodwin indifferent that they do not see
however,
If computed
proached
since 1935, Mr. Morgan was asso¬
report by Dr. E. F. Izard, L. E. aluminum and about as great as
Amborski
and
D.
W.
Flierl of that of mild steel. Tensile strength
Inc., Buffalo, N. Y.
The new film, a chemical cousin
&
Riecke
A.
Active in the securities
"The breaking elon¬
of aluminum,
gation
men
men
young
have
activities.
a
E. I.
Morgan
similar
and fathers
who have ap¬
on this question. I
because I think the
advice to young
of
Russell
E.
other line of
given
have
I
endeavor.
Morgan will direct the
strength in the same range as
aluminium,"
the
report
film
to him and
might become asso¬
pre-determining stock market sacrifice demanded of young men
trends by mathematical methods. starting their careers is too great.
In addition to making this serv¬ This sacrifice stems in great part
ice available to the clientele of from what I consider to be un¬
vertising
pointed out.
strong
ciated with in some
hard
Society at Atlantic City, N. J., on
Sept.
17
a
transparent,
plastic
as
of
Stud¬
ies" process of
aluminum and highly resistant both
as
result
Timing
impact and to electricity.
to
to whoever he
"Investment
Plastic Film
product strong
view¬
abilities
his
that
as
pioneering and,
developing the
Develops Haid Transparent
Company reveal
my
should be worth more
circles
the
that high prices and pre¬
vailing prosperity are 'phony' and 'artificial.' To such charges,
the investor or average American retorts: 'I should prefer prosper¬
ity, even though artificial, to poverty, however genuine'."
thetic
I
in
ties
political or ideological reasons, contend
Three chemists of Du Pont de Nemours
vocation for
my
and
college two years ago.
keenly
feel
mediocre
a
all
goes
business
no
the
he
securi¬
York
This
experience
Harris
discouraged him from entering
securities business because I
I
Philadel¬
phia and New
management were to pay out 60% of profits
after taxes, or $10.4 billion and if the yield were to remain the
same, or at 4%, the price list would stand at 260. On the basis of
a 3.2% yield, the list would advance to 325.
"Professional critics or those who feel obliged to criticize for
"If
is
E.
Herbert
have
from
ated
receives
down the line and certainly there
might be interested
a son who gradu¬
you
them—than
to
lawyer.
operate a
shop." But, even though
to know I
is well known
'
$100.0
$124.0
.
i
their firm.
56.3
5.0
-
__
titled
interested
be
work.
to
is certainly en¬
higher fees—and
points.
asso-
willingness
and
instance, who produces supe¬
amla small business, I hope you
I
same
tor
years
"one-man
Russell
E.
the
rior results for his clients,
been
has
30
over
13.3
52.6%
of profits after tax
$225.4
365 shares.
Id., in %
Exchange,
Stock
phia-Baltimore
on
experienced and able attorney,
business
members of the Philadel¬
Street,
be
An
invest¬
ment
not so then
were
would
as
ability
very
9.5
9.1
Dividends
of
a
the
great measure of dif¬
is-the case with members
labor
unions — regardless
of
level;
small factor in
A.
Walnut
a
If this
fessions.
everyone
the
am
very,
135.2,%
17.3
taxes
I
1528
Inc.,
Co.,
&
Riecke
of '38 Dollar
In '38 Dollar
Amount
There is
more
into
out
course,
ference in all businesses and pro¬
invest¬
Pa. —H.
PHILADELPHIA,
Gain in %
billions $288.2
income
[
of
transactions.
ment business.
H, A. Riecke & So.
225.4.
am ( Est.)
With
is,
through commissions or profits on
impor¬
the
in
on
institutions
for
problems
open.
on
price of the Standard-Poor list of stocks, while 1952
dends are expected to yield almost 4%. If the yield were to
that of 1938, the price of the list would be 284.1, compared
average
National
most
matter
than 52V2% of
profits after taxes, whereas in 1938 aggregate dividends
uted, exceeded profits by almost 40%.
"In 1938, dividends paid amounted to almost 3%%
Corner"
do not
this work
and the only way a dealer can be
compensated for the work he does
Dutton, page
tant
institutions.
those
capitalize
directly
acetate,
methyl ethyl
I want to com¬
ketone, xylene, naphtha, methvl;
pliment
and
'Cellosolve,' methanol, and glacial
thank you for
acetic|acid."
bringing this
prices,
hand, current stock
near
ethyl
as
56.3%.
"On the other
even
or
point, by such solvents
the boiling
period of only
gain within the same
a
temperature,
formation^ to
31] deals with
one
of the
film
room
my
["Securities Salesman's
by
John
perature is essentially zero. The
is not markedly affected at
1952, expressed in terms of 1938 dollars are
expected to exceed 1938 figures by about 313%,
dividends similarly computed, are estimated to
show
opinion, your article in
the August 28th edition of The
Commercial & Financial Chronicle
In
tative
prices are not only not excessive, but appre¬
ciably lower than warranted.
"Although corporate profits after taxes for
in jeop¬
More often than not, they
Chronicle:
Financial
of
and
Commercial
The
Editor,
of impermeability to" water
vapor, organic solvents, odors, oils
and greases. Its water vapor per¬
meability is in the range of that
"Analysis of the various statistical and
indices in terms of real dollars,
rather than what one might designate as cur¬
future
says
are
ardy due to the gradual "thinning out" of experienced per¬
sonnel caused by restrictions on profitable operations.
gree
barometric
dollars, suggests that
of investment business and welfare of investors
It offers a high de¬
window glass.
Dayton, Ohio,
Herbert E. Harris, securities dealer of
of
90%
transmits
film
light in the visible range of the
spectrum,
and its transmission
curve
is similar to that of soft
Club on Sept,
follows:
rency
much
is
range
greater
talk on the
a
Margin Endangering
Security Industry and Investors
other known material, and its use¬
securities market, given at a luncheon at the
18, sponsored by the National Securities
& Research Corporation, of which he is a Director and Consultant
on international affairs, Dr. Max Winkler, of Bernard, Winkler &
Co., members of the New York Stock Exchange,
summarized the highlights of his remarks as
In
low Profit
its in¬
higher at
is
resistance
"The
Bankers
in
use
sulation
for
data indicating bases exist
higher stock price levels.
Max Winkler presents
Dr.
' ' * '
capacitors,
ing. '/
TO THE EDITOR:
LETTER
temperatures,
moisture, ultra¬
violet light, and outdoor weather¬
I
know
-fn+nyo
ic
of
no
m nre>
business whose
in
ipnnarriv
be—
Volume 176
Number 5154
..
The Commercial and Financial Chronicle
.
(1131)
the
gradual "thinning
experience, and the utter
of
cause
out"
of
lack
of
effort
to
make
Continued
from
15
page
career
a
attractive enough to warrant con¬
sideration from the type of per¬
sonnel it needs. I hope your warn¬
'
the
to
as
Dayton, Ohio, Sept. 4, 1952.
conditions under which trol
controls will
Geo. N.
Fleming Opens
Own Company in Phila.
PHILADELPHIA, Pa.
N.
formed
George
F1
George
Fleming
has
Co.
N.
ing
e m
Locust
to
the
Manager
Co.
past
ducted
are
George
his
N.
John Y. G. Walker,
Jr., member
of the New York Stock
Exchange,
will
be
admitted
to
partnership in Granbery, Marache
& Co., 67 Wall
Street, New York
City, members of the New York
Stock
Exchange. Mr. Walker
formerly active
floor
broker
Coppet &
as
and
Doremus
was
individual
an
with
was
and
standard.
There
would
be
appropriate
standards.
the
such
However,
significant
of any
that
say
I
case.
this
does
control's
anxious
possibility that there
because prices in
tinue
we
to
can
line
in
I
study the
make
De
Riter
the
to
work,
not uniform.
hides.
way
in
Capehart
the
my
or
duty
possible,
place in
much
with the personnel
lems of
our
and the prob¬
Division,
whose
actions
industry.
the
men
from
to
and
hands
to
of
make
available
and needs.
ernment
who
ceiling prices
We may not be
people
be
in
arise
because
of
the
to
ments
to
applications
situation.
We certain¬
continue con-
inclined
more
are
increase
to
result of the
a
\
_
being paid out is likely to occur
./■■■
..
'
•''
■
.
.
changes which have taken place during and
II, insurance companies have been paying out
visit the Rubber,
between
some
instances certain companies have distributed less than 50% of suck
income.
Chemi¬
In spite of dividend increases made during the past sev¬
eral years,
Drugs
ation
institutions
considerably less than 75% of investment earnings and in
historical
most payments
still conservative judged by most
are
measures.
Within the past few years there have not been any spectacular
increases in cash disbursements although there have been
a
ber of companies which have
If suspension a big job—an important job—to
desired, it would be necessary do and it can only be done suc¬
for tne producers to acquaint us cessfully with the fullest cooper¬
a
'■
.
since World War
particular product.
ly do not want to
different
investment earnings
of
As
Rather,
paid sizable stock dividends.
num¬
increase in cash payment has usually been modest with the
any
is
with such
the
again.
particular, I should like to
to each of you an invita¬
cals,
of
of 75%
the
most
extend
tion
While
years.
dividend "payments than when the reverse is true. However, as the
insurance underwriting cycle progresses, the historical relationship
controls.
In
past several
underwriting results in the determination of divi¬
largely psychological. In other words, when,
underwriting operations are progressing favorably, the manage¬
help¬
ful in solving the problems which
can
the
The role of
Get to know the gov¬
career
so much on the underwriting
the increase which has taken
on
over
dend policies has been
represent
their
agencies
income
Historically the dividend policies of fire and casualty companies have been based upon investment earnings with approxi¬
mately 75% of such income being distributed to stockholders.
an
Washington
industry
your
views
the
the
up
go
such
the current year as
investment
a cyclical pattern invest¬
earnings have been rising steadily for ten years.
ment
the chemical
on
Hold
who
our
have
can
important effect
extra
an
underwriting experience has followed
Agency,
other agencies in Washington
and
its
as
larger disbursement in the form of
a
.These expectations are based not
yourselves,
as
Insurance Stocks
—
payment is anticipated.
results for
and Fuels Division.
aware
at OPS of some instances When you have
a
problem^inwhere current selling prices ac¬ volving pricing of chemicals you
tually
are
substantially
below will find the people in the Chemi¬
Branch
willing,
able
and
ceiling for the members of the cals
industry who are making some anxious to be of help. We have
are
yearend
acquaint
due
and
in
for while in others
if I failed to urge you to
of
22
remiss
JOHNSON
.Thus it is expected that over the next several months
many
companies will consider their dividend payments including extras
to be paid. In some cases an increase in the annual rate is looked
progress
should be
for
CPR
This Week
E.
4The final quarter of the year is the traditional time for fire
and casualty insurance companies to review their
dividend policies.
in which
way
H.
fact,
along that
the chemical industry.
agencies
or
In
get out of the
business of price control where
it is not necessary for the
preven¬
tion of inflation and we shall con¬
industry are not fre¬
quently publicized in the same
way in which you have exchange
the chemical
cotton
sake.
to
knowledge of
not the industries' practices, problems,
am
areas,
adjustments
1st
extent
new
aware
to
which
Admits J. Walker, Jr.
Oct.
important
for
are
Moreover,
Philadelphia.
Granbery, Marache
on
not eligible for de¬
we
quotations
Fleming
.
ment business in
important to the
so
any
our
xclude
are
invest-
-own
are
the
.'rank
con-
necessary,
a
where this is the
rea
in
and
the
if
re-
and to the defense effort
not
am
&
and
at
that
at
opinion that chemicals
to
m.er
of
Blizzard
clear
suspension
be
suspension
H.
made
be areas in the industry where
may
formerly
be
when
they
under
Mr.
reimposed and of
higher level of
ceiling prices than that existing
prior to suspension, except as re¬
quired by law.
that
was
Herbert
of
not
control
in
securities
business.
control,
economy
Street
Fleming
must
generally
of¬
engage
It
time
the
It is my
2047
at
he
appropriate recontrol mecha¬
nism.
&
with
fices
the
will
—
By
Current OPS Policies
HARRIS
E.
Bank and Insurance Stocks
Pricing Chemicals Under
ing will be heeded.
HERBERT
23
implied intention of maintaining the increase in disbursement al¬
most
industry and your
indefinitely.
This
government.
&
same
pattern is expected to prevail for the current
Thus, it is anticipated that
year.
number of the major companies will
a
Co.
Wm.
Schoellkopf To
BUFFALO, N. Y. — William
Schoellkopf on Oct, 1st will be¬
a
partner in Doolittle & Co.,
Liberty Bank Building, members
of the New York Stock
municipal dealers of tending included * Alfred Rauch,
Philadelphia and Pittsburgh joined also a Kidder, Peabody partner;
with the Pennsylvania Municipal Francis P. Gallagher, manager of
Authorities Association in conven¬ Kidder, Peabody's municipal or¬
tion in Reading, Pa., this week to ganization and Chairman of the
Bankers
Association
formulate a program to provide Investment
better
marketing and improved committee on municipal bonds,
and Willard M. Wright, Jr., man¬
distribution of Pennsylvania's rap¬
Exchange.
Mr.
as
the
Both
of Sept. 30th.
officials and
au¬
New
York
Stock
Exchange,
on
Oct. 2nd.
Seeley & Lindley Admit
Paul
Campbell will become a
partner in Seeley & Lindley, 61
Broadway, New York City, mem¬
bers of the New York
change,
on
Stock
October 2nd.
R. V. Maguire Co.
1
LONG
Ex¬
Opens
ISLAND CITY,
N. Y.—
Robert V. Maguire is engaging in
a
securities business from offices
at 4755 39th
name
Place under the firm
of Robert
V. Maguire
Co.
IV. H. Tremper, Inc. Opens
_
MIDDLETOWN, N. Y.—W. H.
Tremper, Inc. is engaging in a
securities business from offices at
10-12 North Street.
raise
who
—
Drexel & Co.; Willard
local Pennsylvania Authority
Jr., Eastman, Dillon &
bonds.
Co.; Russell C. Schuler, First Bos¬
ton
Corp.; Leighton Macllvaine,
(3) Estabhsnment of a central
Goldman, Sachs & Co.; Eugene
clearing bureau which will collect
and file all available financial and Arnold, Harriman Ripley & Co.;
John B. Bunting, Janney & Co.;
technical data concerning existing
Frank L. Satler, Jr., Moore, Leon¬
local authorities; maintain current
ard & Lynch; Joseph C. Carson,
information on forthcoming bond
Rambo, Close & Kerner; Russell
issues; make this information im¬
C. Schaffer, Schaffer, Necker &
mediately available to investment
Co.; Donald Poole, Schmidt, Poole
bankers,
banks, insurance com¬
& Co.; Charles N. Fisher, Singer,
panies and other qualified inves¬
Deane & Scribner; Russell M. Er-*
tors; and disseminate this informal
tion regularly and rapidly to all good, Stroud & Co., and A. Wil¬
liam Battin, Yarnall & Co.
publications to
bring
about
a
dividends is the trend
source
volume of invested funds
which permitted
The
This
well
as
better return
a
combination
these
of
increases in dividend payments
end
and
initial
sided
senior
over
conference
a
final
partner
conference.
,
expecting increased
Earnings from this
the result of
was
increase
an
as
on
larger
a
firming in interest rates
some
new
purchases.
factors
points
to
number
a
including possible extras
this
same
connection
there
have
been
of
or year-
number
a
larger insurance companies which have recently made
or
of
the
announced
changes in dividend payments.
.
General Reinsurance Corp. on Sept. 9 increased the quarterly
payment from 30 cents to 40 cents
or on
annual basis from the
an
$1.20 paid in the past several years to $1.60.
stock
dividend
holders'
was
approval at
Another
declared
a
company
increase
to
was
50 cents
semi-annually for
extra
was
Oct.
its
declared
to
stock¬
total of $1.00.
a
to
stockholders
On Sept. 18
a
paying
10-cent
bring expected payments for 1952 to $1.10
a year ago.
There have also been
the
10%
a
to
Camden has been
a
number of companies which increased
their payments earlier this year such as
Fidelity-Phenix.
subject
payment
Camden Fire Insurance.
against $1.00
In addition
24
meeting to be held Oct. 15.
recently
as
payable
There should be
a
Continental Insurance and
number of other increases in
coming months.
Richard D. Barash Is
Chas. Weinstein Partner
Richard D. Barash has been ad¬
to
partnership in Chas.
Co., 135 Broadway,
New York City, members of the
New York Curb Exchange.
Mr.
&
BANK STOCKS
The
forces
more
are
tion
making these securities
attractive
cussed
now
to
in
our
for
investment, dis¬
May,
1952,
Bulletin,
operating. We direct atten¬
this
group.
Barash has been with the firm for
some
time
as
Manager of the New
Exchange Department.
Laird, Bissell & Meeds
Members New York Stock Exchange
Members New York Curb
Joins
Matthews,
in Phila¬
generally better than
were
disbursements.
In
York Curb
de¬
program was pre¬
by Orus J.
resident
on
this
in
*
in dividend payments on stocks held and the income from
Weinstein
The
unprofitable
on
experience
of investment income.
first half of the current year.
mitted
the P. M. A. A. attended the second
better
the larger companies continued to increase in the
among
standing
Otto J. Fink, partner in Mann¬
delphia of Kidder, Peabody & Co.
ing, Shanley & Co., passed away and a former
Secretary of Com¬
on Sept. 18th.
merce of Pennsylvania. Others at¬
'
year ago.
broader
communities' securities.
increases
a
The six months' underwriting results for
.
velopment of
Otto J. Fink
bring about
Another factor in the current outlook for
Schmidt,
Boothby,
More than 40 members of the
knowledge and' under¬
of Pennsylvania munic¬ investment banking fraternity in¬
cluding representatives from Easipal tax exempt investments.
ton,
Harrisburg,
Sunbury
and
(4) Development of a strong and
Scranton along with officials of
reliable secondary market for each
the current outlook for better
rate
major companies support this view and
a
the
weekly quoted service of selected
Recent
should help to
phase of the operations.
of Kidder,
ager
capital for nicipal Authorities Association of¬
Burnham to Admit
the much needed community im¬ ficials: J. E. Kuhn, Belle Vernon,
Burnham
and
Company,
15
provements—agreed on a program Chairman of P. M. A. A.; Claude
Broad
Street,
New
York
City, which both
groups anticipate will C. Fogelman, Northampton, Secre¬
members of the New York Stock
be acted upon promptly.
tary-Treasurer,
and
Charles F.
Exchange, on Oct. 2nd, will admit
Main points of the program call LeeDecker. State College, Execu¬
Ernst N. Petschek to partnership.
tive Director.
for:
Mr. Petschek will acquire the New
Others in attendance at the first
(1) Formation of a joint com¬
York
Stock
Exchange member¬
mittee of municipal dealers from meeting were: George Lestrange,
ship of Edward A. Rosenthal.
Pittsburgh and
Philadelphia
to Arthurs, Lestrange & Co.; Elwood
plan and put into effect a specially A. Robinson, Aspden, Robinson &
To Be du Pont Partner
devised education program seek¬ Co.; Edward J. MacCoughey, Blair,
James M. King, Jr., will be ad¬ ing to broaden the demand for Rollins & Co., Philadelphia;
mitted to partnership in Francis local Pennsylvania
authority is¬ Charles F. Peeler, Blair, Rollins &
I. du Pont &
Co.,
Pittsburgh; J. Ward Tate,
Co., i Wall Street, sues.
New York City, members of the
Sherrerd;
Marshall
^2) Inauguration of a regular Butcher, &
ers
business
Peabody's Phila¬
delphia
municipal
department.
municipal authority Joining in the conference were
the investment bank¬ the following Pennsylvania Mu¬
Schoellkopf is a partner in idly growing local municipal
Schoellkopf & Co., which will be thority bonds.
dissolved
This expectation is supported by
underwriting operations.
Leading
Be Doolittle Partner
come
enlarge their payments to stockholders in the coming months.
Seek Wider Market for Penn. "Authority" Bonds
(Special
King Merritt
to The
COLUMBIA,
Burk
is
In Investment Business
with
Company, Inc.
Financial
Mo.
Chronicle)
—
King
Virgil
Merritt
Ruth
F. in
a
Scott
Seaton
securities
is
business
engaging
from
of¬
& fices at 52 Gramercy Park North,
New York City.
120 BROADWAY,
Exchange
NEW YORK 5, N. Y.
Telephone: BArclay 7-3500
Bell
Teletype—NY 1-1248-49
(L. A. Gibbs, Manager Trading
Dept.)
Specialists in Bank Stocks
,
24
The Commercial and Financial Chronicle.;.
(1132)
We Have the
Succeed
to
Right
—And the Right
miracle—the
short
of
root
but
industry—demanding an increase
in capacity—and at the same time
refuses to make it possible for the
industry to attract the,, necessary
capital to expand. So, government
goes into the power "business it¬
self.
Rates are increased, and the
state
trenchant
word
a
seriously impaired by the device
misused word.
a
aided
have
ple essence, it
cution
means
and
the
such
enforcement
agreements
no
re¬
strictions
the
In
on
right
no
restrictions
on
the
right
right to
stances,
rep¬
resentatives—
the right to
on
buy—on
the
right to sell—
on
the right to
invest—or
the
on
right
Laurence
particular time, the
right to work is particularly important. The economist refers to
In
as
number
a
membership
union
At this
work.
an
an
counted
is
r.
to
►*,
..fa..,,
instances,
many
far too many inemployee must support the local and national union
leaders—or he is denied the right
to
work.
By those tokens, the
word freedom becomes a mytha word of irony—a lost value.
In those instances, the individual no longer counts; instead—he
the
cnoose
political
too
them.
by
to
speak—on
far
employer must agree to the terms
imposed upon him, even though it
is financially impractical to abide
to
worship,
and
If
on
records.
the
railroad
industry
so—then
that
is
the
in¬
and
m
That is the end of progress,
And that 1S the beginning of the
dlT r?t and stagnation which char-
acterized every society that has
succumbed to the siren song of
directed Jrc^onJ*c?j
**; is ll the field of providing
capital that life insurance plays
an increasingly important role in
°ur
competitive society. The
trend has been to turn more and
.,.
mf°fre to the private accumulators
™rU
S.'
j-
The individual policy holder
Pr°bably does not regard his life
msurance
right
"mobility of labor,"
which means that if you don't like
the job you have, you are free to
q
In
short,
we
succeed, and
we
have the right to
have the right to
8
fail.
Many other people fail
derstand
the
rights to
the
and
motivation
of
the
American economy.
The economic facts of life are
we continue to
ignore them, there is a dangerous
those aura
about the future that no
by-passed-and if
to
importance of
un-
thinking
our success.
man
can
fail
to
But whether the peoples of the
as
are
they
it—or criticize it
interested in it, because
of the increased standard of
living
that it has brought to our
people,
of
them
cannot
under-
stand that it is freedom
of action
which accounts for our success.
TW .
,
.
They have never known such
freedom—or else they have gambled it away in a will-o'-the-wisp
n
chase
for
security
through
onJuSn
are
like
Amer-
people who
borrow or adapt
many
to
-
*
the unsuccessful economic
systems
from abroad which have
only resuited in failure.
hehnnvea
the
no
mitted
for
oiir
Children
debt
u*
ue
sair£
Lt* £
slkes' but
uf if those who come
not alone
after
our
own
ehlift^fenlfe3, rrvCOr2"
! Siiw grandIS? public
to
Rut
wo
backer if
Chapter in the chronicles
make it
of time
we
them
to
impossible
that debt
And
that could happen. It could happen by destroying the free enterprise system from which our com¬
pay
parative abundance and
compara¬
tive wealth have
sprung.
Our Freedoms Are Slipping
Let
they ignore profits
incentive
an
approve
produce,
to
but
tax
in-
and
wage
nrpminnre—and
from
navments
Premiums—and liom payments
^!s:
..
,.
.
,
on
us
make
no
mistake
about
it: these freedoms about which we
talk so glibly are fast slipping
through
our
fingers.
The employee's right to negoti-
+
an
National
writers,
government controls.
For
tect
1
t
s
S
astounded
mvsterv
some
if
as
or
there
some
evil
SeS^h the^Safonofoureconomic structure
rhel foLet—with childish in-
difference-that
it
is
are
address
by Mr.
Association
Atlantic
City,
of
N.
Lee
Life
J„
before
Under¬
Sept.
1952.
10.
11 is a Personal stoiY as well as
an industrial story. It is just as
Personal as worthwhile, for durinS 1951>the life insurance invest-
J*
competition
production—that attracts the consumer and keeps prices at levels
that
capitalism,
fair to all concerned.
taied $5,000,000,000. They h
aJ[s0 invested in farm financing t
J
exient of holding 24.2% of a
farArV1 mortgages addition to 1, 1952.
as of Jan. one of
All this
in
is
what
nedoes
is the
f i
r
result of these tnr-
edaeainst
economic
peaoes i i r e a againsi economic
treeclom*
The result is
A.**"
the greatest innovations in our
economic system—the creation of
from
the
pro¬
.
Bottle up capitalism, and you ^oulder to the wheel of Amerithe
Administration's Lack of Concern
for Approaching Disaster
idea of insurance.
tution
solid
The
labor-rrianagement industry-wide bargaining idea—Washington political pressure for price
of
life
The insti¬
insurance
backlog
of
tireless efforts of
owes
its
the
the agent who
respect
to
has constantly emphasized the im-
portance of savings to the Amer-
controls—the attitude that profits ican people,
aff somehow indecent, must be
j would like to suggest that you
attributed to the Administration's men are cut 0ut for the job of
lack °* concern for the disaster selling ] the American people all
we are raPldly approaching.
over again on the idea of Amermight take the field of electrie power as an example of how
to flirt with disaster.
Today many
state
utility commissions
are
re-
ica.
You
have
done
so
well
on
so
what you're up
can see
against when you tackle the job of
reselling the American idea and
the institution of free enterprise.
difficult.
It will be
That's also
people.
a
matter of record. You are thought-
inspiring—and you are catalytic
They want to "in¬ agents for thinking people—just
as you are agents for your insur¬
nonproducing, inefficient
enterprise.
sure" the
worker
an
highly
efficient,
worker.
that
equal income with the
Their idea of how
is
to
drag
the
do
to
better
man
down to the level of the less able.
All manner of devices enter into
this
idea—some old—some
new—
most of them calculated to curtail
if
not
to
punish
superimposed
vices is the
incentive—and
all
on
new
the
old
de¬
and more sweep¬
ing device of industry-wide bar¬
gaining with security provisions.
To
ance
large-producing
I
companies.
say these things about you
now
with objectivity and
can
of
as
dispassionate appraisal. As Presi¬
dent of the National Chamber, I
talking in the interests of all
when I single you out
this heavy responsibility.
It
am
business
for
is simply a fact that the need ex¬
it
ists—and
is
the
a
further
men
to meet
simply
fact that you are
the
need.
Study Possibility of Creating
a
National Central Mortgage Bank
Aubrey M. Costa, President of the Mortgage Bankers Associa¬
tion of America, announces
appointment of a special committee
of his organization to
explore the problem.
The
possibility of organizing a
mortgage banking system
central
somewhat1 similar
to
Reserve
in
System
banking
or
the
Federal
commercial
the
the
mi11
e
interest
of
e
c
i
a
"Of
Mortgage
tion
of
Costa
ment
Aubrey M. Costa
M.
the
below
as
type
present
greater significance to the
of
that with establish¬
central mortgage bank
a
the government's heavy burden in
this field could be largely or en¬
tirely eliminated. The federal
Dal¬
ernment in recent years
the Association's President.
The investigation which this grouo
will make, Mr. Costa advises, will
a
rates
the prospect
of
ac-
with
conventional
country generally," he added, "is
las,
begin
unattractiveness
to
ig¬
pres¬
market level.
of
Bankers Asso-
America,
—
mortgages and other investments
because
of
their rigidly
frozen
a
members
Administration in¬
and Veterans Ad¬
nation-wide market
a
compared
ex¬
by
had in the past. Fed¬
relative
ent
field
be
ever
noring for the moment their
and loan asso¬
ciation
a
Housing
have
savings
will
than it
eral
investment medium
far greater liquidity
an
as
enjoys
ministration guaranteed loans now
in
Bank
Loan
gage
now
sured mortgages
Federal Home
gov¬
has poured
millions into so-called emergency
and
'stand-by' agencies in the
mortgage field
such
the RFC
as
comprehensive re¬ Mortgage Company and the Fed¬
which a technical eral National Mortgage Associa¬
will be employed. tion. A central mortgage bank
search study for
organization
clude
Title
named
members
Committee
in¬
President,
Guaranty Company of Den¬
Aksel
Nielsen,
could
Savings Bank, New York; Milford
ceived
Vieser, Vice-President, Mutual
Insurance Company,
Benefit Life
Newark; James W. Rouse, Presi¬
this
unnecessary
"The Association's
bank
A.
make
heavy federal burden.
and a former Association
President; Harry Held, Bowery
ver,
dent, The Moss-Rouse Company,
Baltimore; Franklin D. Richards,
our willing- cover some 3 million workers,
ness t0 risk capital in starting a
Franklin D. Richards and Asso¬
new business or in expanding an
of kif® Insurance
ciates, Washington, D. C. and until
existing business is amended. It
But let me turn at this point to recently Commissioner of the Fed¬
have corked the effervescence of can society,
0Ur competitive economy. It is
As life insurance agents, you
have sold the American people on
the begtoning °£ the end.
is
ignoble purpose.
an
you
a
hazards of free
private pension plans that today
is the risk_taker who keeps capi- the even greater need for the life
talism alive and growing.
insurance i n d u s t r y to put its
to
So
provoking
example, they want to
us
the
.
idea
as
"insurance"
word
—
and
cording to
were
America.
the
that
They merely want to "insure" us
But you can
do it. You are
against the hazards of exist¬ thought-forming people. That's a
ence
by government direction matter of record. You are thought-
plored
^
u0
aP1?V11}!' wl11 be somewhere above
world
compliment
insurance
the
take it
dreaming,
all
Aubrey
We
♦From
socialize
to
special com-
,
yv3mi(Lfont ailvwliPrp
.Y°u can
k„ anywhere you
manufacturer, supplier, distribu- w.sh, and you w.ll.see the results
of life insurance investments in
tor and retailer. When these harassments cut production, as they industry
helping to assure the
«« tw muuslry
naturally do, the controllers pro- continuing growth of competitive
fe
used
even
They claim they
want
order them to be absorbed by the
? great Paradox of the in the market place that inspires
Century—but here in
there
would
the
billion to invest: that
money—available from
is
vices label their plans by the name
of "insurance."
creases and with bland placidity
cen-
trahzed authority. And that idea
has never worked in any land.
for
$7
new
T,Jie staiY
lljf insurance mvestment in the American econ°my 1S a story super-charged with
approve
for
about
had
^'J?1llll0n-
—they
It
business
ing business:
world
ica
L'ast year as you a11
the
life insurance
was
that it
and schemers of socialistic de¬
ers
,
only knew it, his annual premium
represents an investment in the
American economic system;^
know-
and
scheming
this
all
in
volved
ican economy. All kinds of dream¬
futuie m
controllers ignore the costs of do-
cism.
Many
stature
into lire
.-^e individual policy holder
appre-
Throughout the world, our econ- hend.
omy is the subject of much disA second torpedo for our freecussion.
In some quarters it is dom of choice is the control of
viewed with envy; in others with prices.
Here again we find that
approval; in still others with criti- economic facts are by-passed. The
20th
If
in
words
—
against the interests of the Amer¬
.
fuel
lexicon
The word insurance has achieved
such
as
fied.
respected
generously but so carelessly ap¬
plied.
But as it stands, it is a
distortion of a great and noble
policy as a form of sav-
,
most
American
stroying the goals of production.
If it were not for the danger in¬
might
Nevertheless, such policies
has ale a lorm fj* saving in tnat peo-
desires even less.
san}e manner* that fhey put
Meanwhile,
the same device mraey into the savings banks,
drives enterprises that create jobs
'"ul ,iaeir P°llcies ore a saving
quit, and go around the corner, out of existence—or sharply curanThtvenQ^°ranIim«?ni
You are just as free to do that, as tails their ability to make those ian*
n,
J
J, ™ 1
you are to start a business, or en- products
which—in turn—create
J?fUei?r tL AmpHnnf^tPm
ter a
profession, if you are quali- more jobs—and which provide the ™
for the American systemthis
the
want to "insure" the consumer
against inflation—so they say—by
crippling incentive and by de¬
1930's.
He
has ceased to be a man; he
become a cipher. His efficiency Ple are Pitting money
means nothing—his ambitions and
insurance to insure the
you
of
one
The same dreamers and schem¬
ers
particu¬
larly since the, depression of the
of
end
.
the
the
don't
abii"cif1?ce.^n Arr\er^a.
That is the end of opportunity,
exe-
of
abetted
Governments
^"e.s °* business as it has
of industry-wide bargaining.
Political forces in Washington
But in its sim¬
the
vade
employer has been
his
with
ate
Federal
and
deprived of tax income.
Will the government next
are
called
story—is
success
freedom.lt is often
American
the
of
agents,
insurance
popular words in the Amer¬
language.
Insurance is one
ican
capital.
Otherwise,
capital remains indifferent. The
government rails at the utilities
insurance
made
most
attract
vehicle of savings and investment.
life
As
new
And it
the
job.
easy
a
have
The utilities must show income to
United States
of directed economics" and extols role of life insurance
the
utility is to
adequate
new
Ascribing 20th Century American progress to freedom of indi¬
vidual action, prominent business leader warns our freedoms
are
slipping through our fingers. Attacks industry-wide col¬
lective bargaining and price controls, and maintains restrictions
on
economic freedoms are extinguishing willingness to risk
capital. Says gradual encroachment of government into busi¬
ness means "end of abundance in America."
Criticizes "siren
At
in¬
an
an
brief appraisal from
insurance point of view.
needs
income to attract
capital for plant expansion.
have
By LAURENCE F. LEE*
as
that costs
if the
in rates
crease
to Fail!
President, Chamber of Commerce of the
song
to recognize
production have increased.
These must be reflected in
That's not
of
fusing
power
Thursday, September 25, 1951
into
it
the
investigation
possibilities of such a
begins
with
conviction
is necessary
bilities
will
or
no
precon¬
to
whether
as
not. All possi¬
be
thoroughly ana¬
lyzed. Every aspect will be subject
to the closest research study. The
work
tinue
of the
as
long
committee will
as
con¬
required."
With Paine, Webber
Administration; John
(Special to The Financial Chronicle)
•
Austin, Jr., President, T. J.
LOS ANGELES, Calif. —Ben¬
Bettes Company, Houston;
Ferd
jamin F. Fletcher has been added
Kramer, President, Draper and
to
the staff of Paine,
Webber,
Kramer, Inc., Chicago; George H.
Jackson
&
Curtis,
626
South
Dovenmuehle, President, DovenSpring Street.
muehle,
Inc.,
Chicago;
W.
A.
Clarke, President, W. A. Clarke
Richard Harrison Adds
Mortgage Co., Philadelphia; Brown
(Special to The Financial Chronicle)
L. Whatley, President, Stockton,
SACRAMENTO, Calif. — Ray¬
Whatley, Davin & Co., Jackson¬
mond J. Pedersen is now with
ville, Fla.; and Mr. Costa.
Richard A. Harrison, 2200
16th
"That mortgage lending needs a
Street.
central banking system has long
eral Housing
F.
been
within
points
bank
the
contention
of
many
the
industry," Mr. Costa
out. "A central mortgage
would
act
to
stabilize
the
With A. G. Becker & Co.
(Special to The Financial Chronicle)
SAN FRANCISCO,
ert B. M. Smith is
selling the institution of insurance,
mortgage structure under all kinds Becker
you are ideally adapted to reselling the institution of this country. of economic conditions. The mort¬ Street.
&
Co.,
Calif.—Rob¬
now
465
with A. G,
California
-
Velume 176
Number 5154
...
The Commercial and Financial Chronicle
(1133)
ceedings out of the realm of State
politics.
We Have Government Management
and local
These
There
01 Railroads—Not Regulation!
fundamental
are
others.
are
tion of these and
By WILLIAM WHITE*
We
est
clearly
and
operation.
Advocates
as
laws: (1)
among
of
means
of each form of transportation should
its cost; (2) elimination of
unreasonable ICC delays in
rate
The railroads
streamlining transportation
users
adjustments; and (3) ICC should
tive
for
making
pay
longer spend to maintain its ef¬
ficiency and improve its services,
the public be¬
the
gov¬
New
in
bly
nota¬
have
subway
opera¬
tion which Mayor Impellitteri in¬
herited is still in the "red" and
yvill probably stay that
way.
The troubles of the Long Island
have followed the same
Railroad
The State of New York,
to get title to it at
virtual
•and
to
of all
a
from
complete
a
taxes
it under
regulation
elimination
except payroll taxes.
Now why should a basic indus¬
try like the
weak
o
railroads be
in
financial condition
business
as
whole
a
is
such
when
bulging
with strength—when the railroads
themselves
dous
are
loads
carrying tremen¬
freight and pas¬
of
sengers and when their
•efficiency is at
Laws
terstate
years
established
was
time
all-time peak?
an
as
a
there
to
regulate
monopoly.
were
no
the
At that
buses,
air¬
trucks,
automobiles
pipelines. Today the railroads
only have competitors who
or
not
are
much less regulated, but the laws
which were set up to regulate the
now
the
manage
rail¬
roads.
In
to
ger
•danger that
ment
takes
functions
of
patent dan¬
system—the
when
comes
the
over
of
American
this
economic
our
private
business
govern¬
management
business—
and
industry
bave remained relatively indiffer¬
ent.
Proposed Reforms in Regulations
That
boxcar
Terminal
bolizes
our
is
the
in
a
Grand
Central
symbol.
start
of
an
It
of
railroad
Specifically, these
sym¬
effort
part to campaign for
ernization
accorded
it
the
they
up
—
for
requests
down
or
without
a
war
have
four
rate
—
be
prejudice
to
sumed
the railroads of the
petitioned
general
justments.
the
freight rate ad¬
The average time con¬
the petition and
final decision on each
these
requests
which
—
subsequently granted
would
freight
be
because
portfolio
themselves
obtain
(3)
made
ously
Mr.
Michaels was
tinental
nois
on
mod¬
regulation.
the major
Illi¬
and
it
necessary
to
the
Pierce, Fenner & Beane
Van
the
In
than,
people,
particularly American
businessmen, to recognize that the
of
want
to
the
effect
should
be
that
removed
that
from
the
the
shall
a
Company.
partner of
a
—
Howard
Waddell
&
Reed, Inc.
He was formerly with
Pont, Homsey & Company of
Boston, and R. H. Johnson & Co.
the
users
of
are
we
are
whatever
propos¬
we
Mass.—Mae
now
Perkins & Co.,
Miss Andrews
P.
An¬
associated
with
Inc., 31 Milk Street.
was
formerly with
Raymond & Co.
of
rate
Joins
give considera¬
management;
responsibility of man¬
haul clause, which
applies to rail¬
roads but not to
highway or air
Lyman W. Phillips
(Special to The Financial
Commerce
form
of
transportation they elect to use
shall pay the full cost of that form
of
transportation, including
fair share of the cost
that
are
provided by
their
of facilities
the
use
of
transport,
step
adverse
be
repealed
toward
decisions
the
of
as
Chronicle)
Mass.
Lyman
W.
Devonshire
the
Phillips
Street.
William
—
Saunders has joined
&
staff
Co.,
He
B.
of
201
for¬
was
merly with D. H. Whittemore &
Co., and Goldman, Sachs & Co.
a
pri¬
(Special to The
LOS
Financial
Chronicle)
donment of passenger train serv¬
ice whenever the railroads can
a
continuing financial loss
from the operation of those serv¬
This
senger
liam
ANGELES,
R.
With William R. Staats Co.
(Special to The
LOS
liam O.
is
designed to take
train abandonment
Financial
ANGELES,
ated
with
640
pas¬
members
pro-
Los
William
South
of
Angeles
the
represent
Chronicle)
have
less
in
faith
(1)
fixed
in
stocks to
common
tion
in
have
been
part.
R.
Staats
These
_
the
idea
are
a
suit
of
(1)
young
latter
causing
worker
in-
Insurance fund assets
the
need
are
for
the
inflation
of
dollar
ered.
This
values
includes
of
needed
the
The
greater
onH
+r\
fully
invested
institutional
New
Stock
&
York
Exchange.
and
are
be
showw
a
is
and
insurance*
relatively
total
the
small!
outstanding:,
relation
of
the*
not
be
bulk
considered
of
a
perraa-
xyz
market
in
the
is that
present
is
bought and sold in
a
lira-
j^ed
period of time, perhaps a
month, the demand on the part of
trusts, funds and insurance com-
for
panies dominates the
demand, due
to the pressure of more and
more
investible
funds
placed
their
in
}iands<
'
A
,.
And we
a
,
iind
..
.
that
,
o.
r.o__
businessmen*
« °*ers wh° "uy (or se.l) suet
a
read^
stock
XYZ due to the belief
as
ft «P«'T?"
ing the most compelling political
re
inflation, are proud to state that
F
.
,
the" continuing
propaganda,
answers
phenomenon, the fact
amount
cov-
dollar
position.
officers
invested
dominant
a
fastly held and!
most securely locked
up in private
it follows that of the*
fully invested posidon-or'an
Some
(3^
aura
hands. And
values.
maintain
of
what
bulI
to
almost
the
the
dependents.
r.-r.afnvc.r.na
funds,
is
rieed
grow-
support
an
"B"
am0Unt bought and sold
by trusts,,
funds and insurance
companies t©
*be total bought and sold
by alk
individuals, traders or fiduciaries?
other than the above?
while it
upon
These dollar values must be
with
c;ourse>
of
trusts,
nent
to
might>
portion
forma-
calls
dividends-1©
trust, and
"B"
only—the
companies
such funds.
to
present
It
for
group.
small
the
that the
percentage of XYZ owned!,
high employment, «md
(2)
of
both affirmative
pension
fund
pension
tions;
(3) a
supplyprovide*
sign of
superior wisdom? At present—andl
But
by
of
wisdom. Has not
at
income
that
funj&
dominant firms of
industries? Is this not
(2)
situs
sells?
and
the
owners
individuals by
sold
"A"
in
business,
no
tte demand
longip"
or suppy
A00' individuals tardily
01
^e
auto-hypnosis of "a rising
"aceentotolhTd^
wittfother3punditZ^lmy^onverse
who
pTrtakforthei^own^beMs6
These?beliefs
A
are
°®ded
opines
that of investment services, lads
who sit at the feet of the mighty,
73%
£££*%
suPP'y and demand, the DJ, which
grow to
leading polling medium
bullish. These individual
w
£
ad
>
^
.f.
iorecasier oi dus
conditions.
The DJ (or any similarly loaded!
°
.
opinions
can
scarcely be said to be
original.
Street,
of
offset infla-
trusts
size
provides fund
have
and/or
trust
xyz
of
1Q%
^he
more
It
so
index of the AVIDITY
panies, who feel compelled to
happens that most of the
of
insurance
the
an
"Leaders"
by the officers of
trusts, funds and insurance corn-
Buying the "Leaders"
officers
index) is
f°r
Calif. —Wil¬
Spring
si
The fact
"A" with
capital gains with which
to keep up the
securities; thus increased reliance
Keyes has become affili¬
Co.,
address
by
Mr.
White
at
the
100,000th
Freight
Car
Luncheon, New
York City, Sept. 16, 1952.
investible funds
group
State
ices.
*An
individuals
more
Now With Neary, Purcell
establish¬
Com¬
missions with respect to the aban¬
show
and
more
.•1
BOSTON,
to
transaction; (2)
demand
"
situation of inflation
a
charter, or other, requirements, many officers of the
above
types of institutions are
compelled to override their liqui-
want
agement—a serious responsibility.
It is just as
simple as that.
(4)
That
the
long-and-short
mary
In
shares
dominant
they would
gross amounts of insurance on the
is
XYZ
hypothetical!
happenings by
the
(In
rise.
part of the insured, generally, due
BOSTON,
a
past
fortunate result of
(1) increasring the price of xyz due to ^
or
Now With Perkins Co.
Chronicle)
funds*
buys 15>000 shares of xyz;
during the same period performs?
have
may
incipient
direction
reverse
ing due
Calif. —Wil¬
Hickey is now connected
with Neary, Purcell &
ing for streamlining our national ment of fair
Co., 210
competition in the
West Seventh
transportation laws:
Street, members of
transportation business.
the Los Angeles Stock
Exchange.
(5) That the railroads shall have
(1) That it shall be the policy
Mr. Hickey was
previously with
of government at all levels—Fed¬ the right of appeal to the Inter¬
eral, State and municipal — that state Commerce Commission from Lester, Ryons & Co.
recommendations
productivity
rise. They
a
the
vestment
with
10000
profit
sel1-)
prior
du
drews
present
of
inventing
specific
in
funds have been growing as a re-
is
us
example
other bullish condition. They
initiated
the
growing
increase
an
increased
to
Due
tion to the effect of rates on rail¬
road
traffic volume.
We
think
that is a function of
likewise,
was
or
a
security.
Too,
investments
Spencer
requirement
Interstate
Commission
attract
rule
present
a
the
permitted
earnings
sufficient
to
equity capital. Secondly,
making
E.
to
Commerce
Congress
and
saw
bought for
manager for
we
directive to the Interstate
Commission from the
a
short
(Special to The Financial
as
Therefore,
he
past
trusts,
investment
(Special to The Financial Chronicle)
economics
well to the railroads
as
any other business.
Co.
PORTLAND, Maine
a
laws
&
argu¬
«B»
demand
Robert L.
Ranson-Davidson
the
by
exchange "Leader."
due
Chronicle)
—
Chicago
was
Let
or
With Waddell & Reed
railroad traffic volume.
little compli¬
cated, but actually its aim is sim¬
ple. First, we want the American
apply
Chicago.
C. W. McNear & Co.
as
on
Ingen
bought
tbat
some
CHICAGO, 111.
the possible effects of these
fundamental
in
the
averages..
and/or insurance
companies. That
fact indicates the
"prudency" of
the selections—does it
not?
forecasting
a
they bought stock of firms cl9ser
to the individual consumer. They
Allyn & Go.
(Special to The Financial
J.
DJ
obvious
their own corporation stock, or
they bought competitors stock, or
they bought in suppliers stock, or
Michaels
Robert L. Greek With
A. G.
the
and
stock
in
maintenance
of railroad credit—rather
seem
A.
a
security analyst, and
that, with Merrill Lynch,
thereto
Act be modernized to direct
the
ICC to consider the effects of
pro¬
This may
Edward
as
before
as
share
Com¬
are
companies*
they bought equities expected to
in the rise. They bought
National
Bank
in
positive
been
has
thought they saw,
prospective boom in business,
a
of
considered
is that price
advances of
"Leaders" have
recently exceeded!
price advances of stocks on
the
NYSE as a whole.
The negative
(and future defensive
argument})
is that these
capital stocks have
Roger C. Heimer
"Dow
saw,
they buy the
"Leaders"
ment
considered
men
with the Con¬
as
cw:
—
Therefore
knowledge to recognize
The
device; based most generally upon
the assumption that when business-
associated
they porated, 100 West Monroe Street.
delays Mr. Creek was formerly with B.
That the "rule of rate mak¬
the Interstate Commerce
on
been
pain
The
"Leaders"
vener-
b1e
Jones"
than
ing" in
rates
man¬
Previ¬
ager.
of
higher rate levels.
posed
The
a
delays not Creek has become associated with
actually A. C. Allyn and Company, Incor¬
the
wide
busi¬
others.
a
-
doubt.
as
the
bell¬
wethers of the business or
pro¬
duction group. Most are
referred!
to as "blue
chips." It needs nc*
to
production too
fund
-
of
no
stocks
widely
Pig iron
ness.
-
modicum
"Leaders."
production as
an indicator of
future
the bull market
peak,
etc.
This
intra-
near
common
hap-
In9orpor&ted,
as
of trust funds and
they feel
leather belting
Michaels, formerly
of
sponsors,
a?
perhaps hesitancy
a
use¬
panned
rates
lower
even
today,
or
^
has passed be¬
The cost to the railroads of
occurred,
changed
offsetting inter-
fulness lapses.
You
know
has
rtual
recognized
"avidity" index
an
overproduction
duces fear or
yond—as have
350
excess
we are
condi¬
joined Distrib¬
were
was
—
these delays has been in
$1 billion. Had these
are
ICC
between
ICC's
days.
conditions,
utors^ ^Qroup,
pany
country
railroads
the face
on
Bank
if
once
merely
Readers" by officers
indicators
have
been
the past to forecast busiDue to
in
related
National
Miami,
of trans¬
rates
Commission
planes,
railroads
which
now,
the In¬
ago
Commerce
.Tailroads
operating
Manage Railroads
Seventy-odd
be
First
Since the
the
free economy.
a
investment executive with the
to
of all
use
an
A.
Averages,
constitute
now
exchange
conditions.
what
Trust
of
trying
bargain price
now
operate
freedom
with
is
agency,
proposes
not
briefly.
for
ness
Distributors Group
ICC's right to review and
modify.
Let
me
explain this
•and the New York
•and
action
eliminated
plus
an
must
adjustments
White
fares
pattern.
seek
enjoys, but all forms
ICC
William
through
We
(2) That unreasonable delays in
we
zation
labor.
under
then let the
chips fall where
sociali¬
higher
disadvantages
will.
Boston.
There
removal
We recognize that the
pub¬
Chicago
and
the
opportunity to compete on equal
terms, with favor to none, and
other
—
seek
competitors out of busi¬
portation
transit
useful
cap¬
enterprising.
Edward
our¬
our
now
subway
lines
advantage for
do
artificial
we
say
just
more.
no
we
we
mean
lic interest requires the
forms of transportation
system and to
•cities
no
we
ness.
York
rapid
When
share"
We seek
which
own
a
tions, this
drive
something.
It happened
City
that, and
of
ernment to do
our
fair
selves;
gins to clamor
are
Edw. A. Michaels Joins
monies.
"their
Stock Exchange
insurance companies.
consider effects of rates
public
Philadelphia, Pa., Members
Various
today
industry in
forecaster,
for stock
We ask only for the
freedom to
be
of railroad credit.
When
an
essential
industry
reaches the point when it can
no
business
transportation system,
fair to all
competing elements in
it, and free of excessive govern¬
Says
Co.,
Mr. Heimer contends Dow
Jones
efficient
an
&
New York
ment regulation.
requires
Admiral, TJ. S. Navy, Retired
Carstairs
sound
railroad management, under
guise of regulation.
trend is likely to lead to
government ownership and
to
By ROGER C. HEIMER
ask
calling attention to generally weak financial conditions of
the railroads, while business as a whole is
bulging with strength
head of large railroad
system lays trouble mainly to govern¬
ment
the Stock Market Index
on
Rear
big start in the
only for action that is
in the public interest. That inter¬
In
for
a
right direction.
President, New York Central Railroad
.
a
proposals will be
More
points.
But the adop¬
few companion
25
the
trusts,
companies
other side
of
the
chase
these
"Leaders"
with
funds, and
gradually accumulating d
have
made
read
coin—that
available
inflationary
o
11
pur-
the
ars
by the political-
process.
Chronicle
The Commercial and Financial
26
Thursday, September 25,
...
1952
(1134)
Reasons lor Recent
It is to be
Dr.
Einzig discusses new
EINZIG
exchange, and contends main cause of weakness of
was
the ill-fated arrangement in August, permitting
goods was
in the second quarter of 1952 than in the second
quarter of 1951—a rise of 5%. An¬
the second
second
sterling
All
Continued from
purchase dollar raw materials for sale to EPU coun¬
tries.
Says though this reduced sterling deficit to European
Payments Union, it resulted in corresponding loss of gold
caused by demand for dollars, and an adverse pressure due
first page
to distrust
LONDON, Eng.—During the first week of September, sterling
depreciated to the close vicinity of the point at which the British
Government had undertaken to support it.
At the rate of $2.78
limited
the Treasury, is an un¬
for
In fact, our relations with
Russia and China seem slowly to
means
$2.78
the
unless the
that
long
as
Dr. Paul
Einzig
because it
the European Payments Union.
picture was represented by the additional
demand for dollars arising from the transactions under the scheme.
Those who received licenses during the week of the operation of
senting the profits or commissions of the British firms engaged
in the transactions. Those who were in favor of the scheme laid
stress
on
difference
this
which
worth while to embark on the scheme.
whole story.
their
in
opinion
made
it
This is not, however, the
The Treasury will lose on balance not somewhat less
gold than it would have lost if the experiment had not been
considerably more gold. For, as we pointed out above, the
evidence of persistent adverse pressure inspired distrust and this
again accentuated the adverse pressure. The authorities had to
support sterling not only to the extent of the dollar licenses they
had granted under the scheme but in addition also to the extent of
the speculative pressure provoked by the operation of the scheme.
The
arangement under which such speculative pressure was
arise could
hardly be described as intelligent.
The Ex¬
change Equalization Fund which is responsible for the support of
sterling ought to have known better on the basis of its own pre¬
war experience.
During the 'thirties it would not have dreamt of
adopting an arrangement which tended to increase selling pressure
on sterling. Indeed, it pursued exactly the opposite tactics. It made
arrangements with the bankers of large buyers of dollars, such as
tobacco importers, to cover their requirements under special ar¬
rangement with the Exchange Equalization Fund. In the absence
of such arrangements the Fund would have had to provide the
necessary dollars in any case in order to avoid an unwanted depre¬
ciation of sterling.
The advantage of the arrangement from the
point of view of the authorities was that it diverted from the for¬
eign exchange market considerable demand for dollars. The evi¬
dence of such a demand would have stimulated speculative selling
of
sterling
more
so
that
on
balance
gold if they allowed
the
authorities would
have
lost
the British American Tobacco Com¬
pany
and other big dollar users to cover their requirements in the
open
market.
meanwhile the authori¬
ties appear to have unlearned much of what
technique in the 'thirties.
mand for dollars from the open
for dollars to the open market.
directly and
of
even
suppose
Now
they had known about
instead of
diverting de¬
market they have diverted demand
Gold payments to E.P.U.
are
made
though the monthly announcement of the loss
gold caused by such payments
able to
per
capita
was
organized
be
under
than
the plateau of defense
spending is reached and defense
outlays no longer increase will the
total demand for goods fall ofl.
Will the eventual slide-off
in defense expenditures, probably
(3)
adout the middle of
a"a 31
^obablv "c^tinue ^lowfwown
the
humbei of dwelling
P°da?^
ward will> however, be sustained
after thd middle of 1953.
They
tQ gome extent fey the large vol.
E-bond maturities in 1953
a™d 195?. The
state
inventories
of
accumulation
broad scale is likely.
a
tories
have
defense
the
in
been
pretty
well
^pendlngo"
drea^d
Inven-
industries
offset the drop in investmen
industrial plant and equipment
and in housing after the mi
e
m
built up
by the steel strike, have been well
maintained.
Building up invennon-defense indus
non-defense indus-
tries was overdone in
may
inspire distrust it is
reason¬
that the distrust inspired by the alternative ar¬
rangement is distinctly more pronounced.
For in addition to the
effect of the loss of gold—which is practically the same under the
governments will inbut the rise is not likely
and
Hence unless outlays
r^xelaLive to tne
and, except for some losses caused
tories in many
in manv
.
^ yea
thereafter defense ou ays a
exPec*e'd to c£ntin'ue at t e mte
ar°und $bU billion a yea .
penctitures of industry on Piaj™
and equipment will be dropping
became the construction of new
pla, i* t0 Produce defense goods
W"J
'3den
y w
c.orJ}~
Plet.ed. The drop will be especially
raPld alter the end of iyo«5. ine
outlays on residential constructi?n, wmch are likely to drop
<£ey piay in rent. Hrace the
^ve
level of prices?
long-run
Hpnrp
on
(4) What is happening to labor
costs and how does the change in
labor
costs
alfect the prospects
the
rpnt
in
nav
1Qg=q
r1^
^
beginning late in 1954, pro.duce a
recession in business?
for
defense expenditures ceas s.
* 5? ^nrfw will pnd
At pf®s
In the fourth place, no specula-
„
,
.
thpv
.p ln
penditures in the next nine months
produce
a substantial
rise in
,
„A°rf, °JL
hkely to undeigo a small but un¬
portant change when t e mcrease
become home owners with an immediate out-of-pocket monthly
cost which is little or no greater
(1) Will the rise in defense ex-
pri<leS'A
(2) After
jjj
condition of the economv is
1951 and
consumer goods
incomes of individuals, the total
demand for goods is likely to fall,
0utlays for consumer goods in
1953
and
nf'
^u
,,
this
m^take
at an eaily date.
^
will not be repeated
t
&
extent
by
bg large ma_
sustained
the
In the fifth place, expenditures turities of E bonds to which I have
of states and local governments,
just
These maturities will
referred
Ai
.
,
Will the
rise
in
defense spend-
ing between now and next summer pioduce
a substantial rise in
In the present fiscal year
outlays of the Federal
Government will exceed its cash
prices?
the
cash
receipts by about $5 billion. Will
not a rise in defense expenditures
which
deficit
requires
produce
considerable
a
prices?
spending
rise in
.
Some small rise is likely,
is
not likely to
conclusions.
ordinate
jn
continue slowly tb increase. The
backlog
of
needs for
roads,
schools, hospitals, and many other
public works is large, but the
making of decisions about specific projects and the preparation
of plans is time-consuming. Communities are gradually increasing
the amount of public construction,
and this increase will continue.
abouf
but it
several subIn the first
place, the gain in the productive
capacity of the economy in the
next year is likely to be about as
large as the rise in the output of
defense goods. If the labor force
increases
manhour
by 1 % and output per
by 2%, the total rise in
about^?"
over
ing for the last several years, will
This con-
be large.
elusion is based upon
which have been steadily increas- be
1952
Buying
limited
whhin
46% larger in 1953 than
and
io%
in
1954 they will be
larger
than
in
1953.
by
consumers
will be
however by the fact that
the next year or year
and
cannot be expected
to jmprove greatly the goods offered f0r sale.
There is a good
half industry
possibility
however, that the out¬
iays 0f individuals will be raised
to a small extent by prospective
expenditures cuts in the personal income tax.
goods, Which have Prospective cuts in excise taxes,
jn tbe sixfh place,
for
consumer
steadily increasing since the
quarter of 1951, will continue f0 rise, partly because empayment will slightly increase,
partiy because rates of pay will
rjge and partiy because the proportion of disposable income spent
on
consumer goods will not drop
been
second
and
is
likely to rise.
of course, will cause postponement of the buying of the affected
goods.
Tax cuts at a time when the
Federal budget is in the red, as
it may still be to a small extent
in the fiscal year 1953-54, will
meet strong opposition, and my
present guess is that cuts in the
billion a
Employment will increase personal income tax will not apconservative'es- f«htly beca.fe the rise in de- plyto vIea7T9l3eircutsTre naSCsed
fense expenditures and in the out- endai year 1953 1:t cuts ar| Pass^
rise in
thp
lays of state and local govern- next summer to take etlect on
aboutU$10
or
These are
timates. If the gain in total out-
year.
pmipU
nut
PUL6^alL
sumption of
the
available
eoods
r-nn-
goods for defense, the
for
civilian
sumption will remain
u
con-
about
un-
n
cxidiigea.
in the next year will Jan. 1. 1954, however, they are
U1
year T
Zp
inl
sllghtlY ex<*ed any drop in the likely to have some immediate in-
ments
investment by private industry, fluence tax cuts effective Jan. 1,
on consumer spending.
Hence
Rates of pay will rise because the
h.gh
Jevel
place, no further
increase in expenditures of indus-
unions
plant and equipment is
likely. These outlays are at a record-breaking rate. They will be
kept high for another six to nine
demands
In the second
try
on
months
in
position.
because
employment
Qf
a
strong
in May or June
1953, together with the steady
growth in the outlays of state and
local governments, could well prevent a drop in the total demand
for goods so long as defense
spending continues at the peak
rate of around $-30 billion a year,
And if a drop in total demand oc-
pUts. 1954, but passed
bargaining
Unions will press their
strongly in 1953
rather
they will fear that their
bargaining position in 1954 will be
less favorable. Hence, they will at-
accelerated
tax tempt to get while the getting is
g0od.
Between June
1951 and
jUne 1952, average hourly earn- curs soon after the middle of 1953,
tures
jugs of factory workers rose 3.7% it is likely to be small,
creasing by the limited supplies of and the consumers' price index by
materials and by the fact that a 2.4%.
The proportion of personal
^
large part of defense production income after taxes spent on conBut what will happen when the
the
by
amortization plan
That was, of course, 15 years ago and
market
will
principal headings:
four
tried
but
bound to
income
disposable
gradually covering their dollar requirements
arising from the transactions. When all the licenses have been
fully used the net direct result of the short-lived arrangement will
be a reduction of British gold payments to the European Payments
Union and a practically corresponding loss of gold arising from
the need to support sterling against adverse pressure caused by
the demands for dollars under the licenses arising from the scheme.
There will be a small difference in favor of this country, repre¬
much
in expenditures for im-
My remarks on current business
trends
The other side of the
now
and
1950
of
quarter
25.6%
aircraft, for guided above 1947 antf 13.2% above the
missiles, and atomic energy are second quarter cf 1952), but the
probable. Furthermore, it is U^ely actual prices of houses probably
that we shall soon be building an have risen more than per capita
appreciable number of atomic- disposable income. Nevertheless,
powered submarines.
it is possible for many people tc
^
are
are
the consumers price index will
continue slowly to rise.
proved types of
of sterling's weak¬
ness
was
the demand for dollars originating from the ill-fated
arrangement made in August under which licenses were granted
to British firms for the purchase of dollar raw materials for sale
to countries of the European Payments Union.
The arrangement
had to be suspended within a week of its initiation because the
demand for the new facilities far exceeded official anticipations
and the limit which the authorities had in mind was soon reached.
The favorable effect of the arrangement became evident early in
September when it was announced that Britain's deficit in rela¬
tion to the European Payments Union declined considerably dur¬
ing August compared with the previous months. The object of the
experiment was precisely to reduce this deficit. It was undertaken
because under prevailing conditions Britain has to settle in gold
the scheme
armaments
when
and
up
doubt that the main cause
her deficit in relation to
Hence, there will not be a
increases
certain degree of distrust.
no
large outlays for new equip-
(it was 8.5% less during the first
half of 1952 than in the corresponding period of 1951) and since the
number of new dwelling units
constructed is running -roughly
55% greater than the increase in
families, the number of dwelling
units constructed next year is
likely to be somewhat smaller
than this year. Building costs do
not seem to have risen more than
per capita disposable income (a
frame dwelling cost about 27.1%
more to construct in the second
quarter of 1952 than in 1947 and
10.2% more than in the second
merely being replaced. Substantial
preciable amounts because diverse pressure on
be
of war will compel
continue to
sharp difference between a period
when armaments are being built
Bank of England
can
in
ment.
the rate is above
sterling was fairly strong. The fact that it
needed support tended itself to aggravte the pressure
There
A
present levels.
above
make
voluntarily in order to prevent the rate
from declining to "support point." As soon as
the rate is down at $2.78 the Treasury is bound
to lose dollars in implementing its undertaking
to support sterling at that rate.
During the
first half of September it must have lost ap¬
a
increase
the armed services to
vene
inspired
of the
the size
that
is
are
we
Latin-America,
in
ground
second
the technology
is not losing any dollars
chooses to inter¬
Treasury
losing
A
and
worse
third is that the rapid advance
buying from private sellers.
so
getting
be
slightly
So long as the rate is above
that figure it is not worth while for the banker
of importers and others needing dollars to
make use of this arrangement, because they
can cover
their requirements at more favor¬
able rates through
international relations is
sight.
armed forces is likely to
approved purposes.
This
r#)AMAM«M n«al?AAlv the demand for goods in the next
C?LA«ft W*
in
ment
in
England, acting on behalf of
seller of dollars on the market
add
conclusion that
lite Mton-lcrilt LCOliOltl 1C UUIIOOK nine or outrun the supply. Hence
twelve months wm mod¬
erately
in sterling.
the Bank of
the
quarter of 1953 is likely.
of these conclusions about
to the general
up
-
5% between
quarter of 1952 and
separate parts of the economy
firms to
rfll
consumer
other rise of at least
pressure.
British
for
outlay
$10.5 billion larger
sterling inspired by the evidence of persistent adverse
This aspect of the device should be borne in mind.
ing of
sterling rate of
developments in^he
goods from
of
have to choose
The annual rate of
consumers
is broadening.
by this experience. Fortunately the ill-advised sceme is suspended
in'any ca^e, but it is conceivable that later it may be resumed,
subject to limitations. Its application even on a smaller scale is
liable to cause additional losses of gold owing to speculative sell¬
Sterling Weakness
By PAUL
which
evidence of adverse pressure on
variety
the
cause
arrangements—there is now also the effect of the
sterling.
hoped that the authorities will learn the lesson taught
two alternative
cess
and by the exThese expendiwill be prevented from in-
profits
tax.
In- sumer goods is likely to rise be- slide-off
in defense spending
the middle of
1953, caUse savings have been fairly begins, probably soon after the
spending on plant and equipment high for some time (though they elections of 1954? If the demand
by private industry will probably bave been falling for six months), for goods has been roughly kept
facilities has been completed.
deed,
be
by
dropping.
In
the
number
of
third
because
place, since the credit
marriages is dropping think)
controls
of
consumer
even
during the plateau period of
have
(unfortunately,
I defense
been abolished, and be- slide-off
spending,
will not the
produce a recession in
Volume 176
business?
Number 5154
The Commercial and Financial Chronicle
...
Incidentally, if the de¬ making available
mand for gooas merely keeps even
from tne midale of 1953 until the
fall of 1954 while the
of labor
grows
labor
loice
ment
of
increase in
may
by
year
a
the
around
1.5
course
-
These observations
term
business
summarized
million
to 2.U million.
No
»
productivity
unemploy¬
better
(1)
outlook
near-
be
may
follows:
as
the
of
can
j
produce
that
if
recession.
a
however,
in
recession
a
One
is
asserting
accompanies
the slide-off in defense
spending,
it will be mild. The
expansion of
state and local
outlays
works will be
be
a
in
defense
on
public
partial offset to the decrease
spending.
Research
in
will be able to put to use some of
the
technological
developments
brought about by the defense pro¬
gram.
the
ofl954,
end
have
research
will
period
to
up
manufacturing plant of indus¬
try
has
been
built
since
1946.
Much of the old
plant and equip¬
is not competitive
the
ment
plant except in
new
ers'
market such
during
the
last
Hence much
equipment
placed,
mand
tion
and
will
a
several
years.
the old plant and
have to be re¬
of
will
and
strong sell¬
a
has prevailed
as
weakening of. de¬
stiffening of competi¬
strengthen
the urge to
For these several rea¬
I believe that the
replace it.
sons
the
drop frpm
high level of spend¬
industrial plant and equip¬
present
on
ment
will
be
moderate
and
that
these
outlays will level off after
they
have
third
about
one-
less.
or
the
By
dropped
time
that
the
slide-off
defense
drop
spending occurs,
outlays on housing
in
well have ceased
the
may
almost ceased.
or
Since the immediate out-cf-pocket
monthly
close
of
cost
houses
new
is
to
monthly rentals, since
always regional shifts in
population, since the annual in¬
there
are
will
the
in
crease
be
and
more
number
about
and
people
more
families
of
700,000,
since
are
pre¬
ferring to live near large cities in¬
stead of in them, the annual de¬
mand
for
hold
housing ought to
new
at
between
900,000
and
1,000,000.
Outlays for
consumer
goods will
be
to
extent
sustained
some
by
the improvements in goods whicn,
by the beginning of 1955, can be
fairly significant.
bonds, which will reach their
in 1954, will drop by well
peak
billion in
a
elections
likely
in
to
which
1955.
1954,
vote
become
Before
are
is
reductions
effective
in
1955.
likely to off¬
effects of the
maturities of E
the
Congress
tax
These reductions
set the
drop in the
bonds.
Finally, and of considerable im¬
portance, is the fact that the rate
which defense spending drops
pretty much within the control
is
of the government and can be ad¬
justed
changes
to
conditions.
The
in
economic
for
reason
this
flexibility is that large amounts of
appropriations
advance
of
are
made
well
in
spending the money.
is ' opportunity
to
there
Hence
change the timing of expenditures.
For all
that
of these
reasons
I
believe
serious recession is likely
.to accompany the slide-off in de¬
spending, and there
may
be
enough to push up
little faster than output
advance in the price of labor will
be greater in tne twelve montns
hour
June 1952 to June 1953, tnan in
the preceding twelve months.
A
whenever
wages
a
per man-
employment
is
high. Tney did this in 1946, 1947,
1948, 1950, and during the first
half of 1951 Apparently they did
the
Sooner
and
or
technological
duce
an
goods,
later, of
increasing
the
course,
volume
of
will
pro¬
partly because of the
new
investment opportunities which it
creates
and partly
because of the
stimulus which it gives to the de¬
mand
for
little.
present
consumers'
goods
by
It
to
is
say
eighteen-month period will be
down,
or
but
movement
be
there
are
up
persua-
for expecting the net
reasons
in
either
direction
to
of around 20% in the price
crease
of
labor
June
period
Perhaps
19o0
it
will
about 5% of the labor force They
not do it in the last half of
three-year
the
curing
For the period of the slide
(3)
output
Tbe
the
rise
June
to
did
1953.
1951 and the first half of
1952, for
be
possible to the rapid wage advances of
manhour in pri-* first
twelve
months
after
last
off in
per
labor
m
two
costs during
and the pros-
years
-n tbe
the
and June
1^9oJ,+is .^important be-
fagter
the
movement
of
demand
is
but the possibility
contraction for a year or
mild
two is very real.
I wish to close these remarks
^
observations
some
the
on
by
effect
of
high
employment
and
strong demand for goods
labor
costs
hence
and
the
upon
Every
now
and
country will experience a
recession, but the recessions are
not likely to produce cuts in wages
—they will merely bring about a
the
upoft
long-run movement of prices.
costs
have
likely
least
to
another
for
reason
tttorfft
year
faster
than
the
Extremely
accurate
nlninrf
rising
increase
the
of
is that
be
manhour
per
at
The
Ua
average
sector
are
for
two.
to
appear
output
for
the
economy.
comparisons
between
changes in wages rates
changes in output per man-
and
be
data that
made
the
with
available.
are
the
iu
that
labor
output
must
and
labor
omer
It
earnings.
the
part of
recent
o.uctivity
of
wage rates
hourly
in
pro-
and
workers
than
a
rise
But rates have also
increased
and, in addition, employees have gained many conces-
sions
benefits
Sick
which
but which
cos.s
in
the form of pensions and
in
wage rates.
labor
raise
not reflected
are
in tbe periods both
immediately before and immediately after World War II output
manhour
per
creased
is
to
seems
about 2.5%
evidence
some
an
a
have
the
in
in-
There
year.
that
unions,
last
such
as
which
unfons
because if
enough
t0
raise
pUsh
A
..
'
must
be adjusted to the
bigber level of costs. The alternament
be
1951, the
average
1950
and
June,
not
the
are
as
and
bv
If
have
T
*
underestimated
sufficient amount the abilitv
a
0f the
engineers and managers to
rajse output per manhour.
by
sufktenramZ^the'Xlfty
a
and
wUiingness 0f
resjst wage
employers
to
demands.
(3)
jf j bave overestimated sufficiently the bargaining power of
unions.
,(4)
If
have
I
underestimated
sufficiently the proportion of the
years in which the economy will
be more or less depressed so that
the unions are temporarily unable
to oush up labor costs,
Any one of these mistakes could
be
sufficient
to
produce
an
er-
conclusion concerning the
long-run movement of labor costs,
roneous
If you examine
carefully the
pos-
sibility that
one or more of these
mistakes has been made, I believe
that you will reach the conclusion
that
the
stable
duofrv
dustry
or
long-run
outlook
for
falling labor costs in in-
uc
urVinlo
whole
r,
as
a
ic
is
nnt
not
tjorxr
very
bright and that, in consequence,
the long-run outlook for an un-
changing
or a
falling price level is
not
the long-run
of
movement
costs.
their
trade
bargaining
major
on
U. S. Aid
by Hanover Bank, Dr. Marcus Nadler, the
bank's economist, says Western
Europeans must recognize and
rectify their shortcomings as fast as possible, as it is neither
unions,
power,
influence
in
desirable or advisable to transplant American institutions and
credit and fiscal policies,
business methods in old world.
it impracticable to
keep credit and fiscal policies sufIn a 32-page booklet, "Impres- ternal economic and
political conficiently restrictive to produce a sions of Western
Europe," released ditions in the Soviet Union, Dr.
price level that is stable in the
by The Hanover Bank of New Nadler says.
molding
Unions
jong
make
run.
York
up to ^be present the
bas
noj.
problem
of
SqUarejy
the
conflict
City, Dr. Marcus Nadler, the
commu-
faced
bank's
the
probably not
exigtg
lem
that
far
s0
to
as
if
Even
optimistic
deny
accep't
we
manhour
bag
rjsen
in
ab0ut
in
the
oroer
too
in
as
the
United States is also indicated by
the
feverish
reconstruction
Western
sive
to
on
labor costs per unit of
have risen over 4%.
In
rely
more
themselves,
He
also
s e r
to cancel out the cost infla-
t
as-
that
d
e
Western Euro-
tion of the last two years, unions
WOuld need to go without wage
increases for over a year and a
must
peans
Marcus Nadler
"recognize
their
own
shortcomings and rectify them
fast
toe^o^fMiattonlhatlh^cwntry
hourly earnings is likely to have by June, 1953,
indusfries'^man'utecturfng^meta! ^fttut ta^e
is not
as
Germany which
the path of any important
and must learn
last
^wo years,
outpuf
war
Europe
movement
lies
in
in
aggres-
by
Russia," he
much
on
aid adds.
"The
rebuilding program
from
the embraces not only factories, office
United
States buildings and homes, but historical
that output
private industry
10%
in
relied
people g0
that it exists,
the somewhat
conclusion
Der
"That the fear of
prevalent
countries have
few
a
stated
Western
European
that the prob-
aware
and
e c 0 n-
omist,
between
maximum employment and stable
prices. In fact, most people are
cl
June,
mx
Europe Leaning Too Much
dally'Brapid—perhaps* nearlyS5% creased^a^the1 normaTrate *of
yCSI*
vl caScU at/ til" nC/IIIldl laXG vX
Between
drop,
numerous
long-run
costs
In booklet issued
policies shall not
restrictive,
a
costs
as
in
labor
costs in most years and in most
industries will creep slowly upward and that the price level will
adjust itself to slowly rising labor
unemployadjustment of
the
credit and fiscal
too
recession,
the
of
of
prices will turn out to be wrong:
chronic
since
through
of
view
movement
expansion in which labor
prices to higher costs requires that
be
no
less than
and will hrincf
and will bring
in lakon**costs.
price level must be expected
upward."
be
This
very bright. The most probable results seems to be that labor
costs,
prices
tive would
drop
years
labor
years of
fast
costs
-
years
to
27
costs rise" Hence the long"run
m0vement of labor costs is likely
to be uPward- since Prices in the
lon^"rui1 must be adjusted to
the
wases
labor
up
.
vpnrc
likely to be
strong
ours,
some
the
But
money
with
economy
recessions
hnnm
about
be regarded as a raime of inflation
regardedas a cause of
that
greater
rather
in
costs
true
rise
Piece
bonus workers
of
much
haTeainTn^'noweTof unions must
bargaining power of nninn^'must
changes in
is
represents
earnings
in
Changes
be inferred from
hourly
unit
per
rising.
are
rates
wage
the
m
c°njclusi°n ls Justified
costs
i
the
imperfections
in
"too
as
chasing too few goods."
become
Nevertheless, I believe that,
spite of
infiation
increases. - The rise
manhour will go on
during boom
simplification is well illustrated
by tbe 0ften repeated description
in
and
rise
or
Anipnow
rates
private
to
this conclusion
wage
ln
rising
to wage
in output per
moSfrv nLlmlnnnduring
monetary phenomenon. This over
rhirincr
C~?a~Jtrade
been
continue
-
halt
the
and
then the
Price
0f
engineers
able to raise output
manhour.
per
level. Writers on inflation
naye 6lven attention too exclusiyeiy 1° the demand side of the
problem and have made the error
net
-the
than
managers are
]?r goods are laying the founda^10n ^or a lasting increase in the
also uncertain,
d°emandSj
unions may
be expected in most years to raise
iabor cosbg by pushing
up wages
it indicates that high em¬
ployment and the strong demand
defense spending beginning
quite late in 1954 or early in 1955,
the
winingnes of employers to
regigt wage
P.ect tbat there will be an addiuonal advance between June 1952
cause
small.
as
K1 a "
possible."
T3n4
But,
as
and cultural
there
monuments
which, if
real fear of war,
probably not have been in-
were
would
any
eluded."
The
main
problems confronting
the four countries he visited
are,
according to Dr. Nadler:
Great Britain—balance
of
pay-
ments; France—lack of confidence
in the
currency; Western Germany
n/Irla/4
1 onlr of capital
v»
added, —lack nf nomlnl for rn/innflwi/»4ia«
reconstruction
V*/-*
he
popu"aTiorand uneL"™^6'"
X un^ted ShTteK P P 4 0n and unemPloyment.
,b'e , °
apd
^ ^ F' ^
S,
mining,
construction, transporta- another year. If output per manArn®ri9aJJ institutions ana metnoas
(special to the financial chronicle)
tion and public utilities, and dis- hour were to rise
by more than 01
a0111*? business to countries
CHICAGO, 111.—Arthur Stevens
tribution)
increased
by
about 2.5% a year, the period needed to wnose economic ana social nistory has become
associated with Daniel
9.6% and, between June 1951 and cancel out the cost inflation would and way
°,,llte dmer s0 ramcaiiy ^
Company. 141 West
June
1952,
by
4.1%.
In
the be shorter
|
restrictions on im- Jackson Boulevard, members of
two-year period hourly earnI do not believe that the country
ouantiiauve restrictions on im
'
ings have increased over 14%. would tolerate for a year and a
FQualitative
This is far above the
"normal"
mahour
well
increase
per
above
of
vance
more
of
or
2.5%
it
and
year
is
per
less
per
even
the extraordinary
nearly 5%
may have
manhour.
year
occurred in output
adthat
per
half
a
rate of unemployment suf-
ficiently
to prevent money
wages from rising so that the rise
in
output
per
manhour would
cancel
has
out
the
cost
inflation
that
occurred
DllltC
since
UU11C,
June, 1950.
plain that the country
has incurred in the last two years
lAdfc
UttUllCU
Hence it is
June
twelve
between
1951. and June 1952
lowed
ttS^large
closely
creases
negotiated
of
wage
months
1950
in
in
were a
wage
the
in-
stabilization.
The
of
record-
breaking increase awarded by the
steel
steel
the
Stabilization
rase
ani
the
companies
actual
Board
in
of
the
to
increase
hold
down
much
below
pressure
The large
nous
coal
for
wage
Not only has the country expea moderate rise in labor
rienced
costs
a
during the last two years but
simiiar
rise
normally to
ployment.
most
jng
be
may
y
expected
It
would
expecieu
indeed
of unions
were
advances.
be
exactly
enouSh to enable them ^ Push
miners
wages just as fast as the average
the pressure.
accentuate
Since the high level
r°blems confronting Western
increase
in
output
per
,
__
.
,
Mr. Stevens
Remer,
was
pre-
Mitchell &
Midwest
„
^
,
.
greater
j,
,
-
coordination
p^nH Their
of
v
J
n
n
il
•
their
milirnrv
FT- WORTH, Texas—J. Clinton
Butler is engaging in
a
securities
lufury whi<;h the individual business from offices at
??u"tries. s'mpIy canno4 af£ord'
Much
^"^Iter"?^8is
b
Summer, Dr. Nad-
visitor
from
the
United
1216
Pennsylvania Avenue, under the
£irm name o£ J' clinton Butlcr
'
£"
tw°rm0"th tour ?£ ^es
ern Europe this
States
Agencies
ASenclesr
r
U—C*
FaitmpJ
C. E. HauSS Co. rormed
BALTIMORE, Md.—C. E. Hauss
most "is the absence of hysteria
js engaging in the securities
busi-
trast^to
ness under the firm name °f
C" E"
the
condition
prevailing
Hauss
up in the United States."
manhour
Exchanges.
viously with
,
accompany high em- ier reports that what strikes the
extraordinary if the bargain-
power
i11^1°^Vr *
E»™Pe^eltfe1' ^C" and the Mldwest
Many of the Western leaders, Stock Exchange,
be 9ontl^ues'
lhejr ecJj"
A
nomlc ar?d Political future depends
J. C. Butler Agencies
on
that will permit full employment. a
increase of the bitumiwill
and discouraging competition,
^adler
less^last.ng nse ,r.labor
the
failure
the Board's award have increased
the
amorew
latter
anticipation
P°^s» r^J.d f°rei2n exchange con- the New York and Midwest Stock
severe
*
The
Wa?P
research
increase in the demand for
goods
whether the net movement in that
half
recession at all.
great
change
at
no
fense
no
probably
An unfavorable
influence is that the maturities of
over
"demand "for
total
impossible
brought into existence
good many new investment op¬
portunities.
About two-fifths of
the
at
ful
power-
vate industry by 5% during the Korean War were followed by a
next year, but such a gain would lull in wage pressure.
be1 far greater than the usual one.
unless there is a substantial rise
a
E
be
raise
of
By
will
so
the
position,
to
seem
i954T"the'
continuing and will sive
industry is going on at a high rate.
Furthermore,
business
concerns
in
bargaining
faster. Trade unions in the
no
United States
middle of 1953 to about the end of
will
justified,
ing
strong
but
conservative guess is that the rise
1953 fivhen the defense wdl be a^ ieast 5%.
uuch an in- not do it in 1919 ^ben unemployreaches
a
peak,
the crease wouid make a total in- ment
averaged
3.4 million,
or
For
middle
the
on
pretend in Septem¬
spending
ber, 1952, to say what economic totai
demand tor goods will
be
trends will prevail in the fall of
slowly increasing.
1954 or early in 1955.
Certainly
(2)
For the period of the pla¬
there is a good
possibility that teau of defense spending from tne
the slide-off in defense
spending
one
of employment and the strong demand for goods put the unions in
a
and the size of the
increases,
and
new
goods for consumption.
(1135)
Western
informed
Europeans
than
we
ar>
are
better
about
in
& Co. from
offices at
North Charles Street.
was
3337
Mr. Hauss
previously with Price & Co.
Chronicle... Thursday, September 25, 1952
The Commercial and Financial
28
(1136)
8
"Regulation A"
Offerings and Small Business
More
on
if the proposed revision became effective.
A similar result might obtain if those participating in
the sale group mailed the literature out to a customer in a
State not listed in the "Letter of Notification," rather than
the issuer or the underwriter doing so direct.
It is diiiicult to understand why the SEC should assume such pow¬
would happen
ers
Congressional intent.
Under the proposed revision, the issuance of a stop
desist order by any State would leave the Commission
of annihilation contrary to
and
the
simple and inexpensive way of floating small
issues of securities in order to help small business.
It will be recalled that for a long period of time, in
to devise
Continued from page
trial or hearing, to
destroy the offering.
free, without any
prohibit the sale and
a
issuers engaged in the oil and
gas industries, and (c) for issuers engaged or intending to
engage in general, commercial, financial, or industrial
ple
in
prompt institution of redeemability of our currency at the present
a
remedy that will prohibit
proposed revision and, in all, this can best be accom¬
plished by direct appeal to the Congress and to its Com¬
to have any
rule-making
should
the
have
never
evade the express
businesses.
for
made
also
is
Provision
statements
financial
"prepared in accordance with generally accepted account¬
ing principles and practices."
Without going into these requirements in detail, it is
sufficient to say that they are so numerous, onerous and
burdensome, and that the preparation of the data, in con¬
formity with them would be so costly, as to wholly emas¬
culate Regulation "A" offerings.
offerings are made over-the-counter, we
the manner in which the Commission intends to deal
Since these
deem
demonstration of the SEC's
partiality in favor of the listed as against the over-thethem
with
yet another
as
It
to
with
wrongdoing in advance of trial and judgment.
pointed out in a previous editorial.
Freedom is
the rest,
for all.
and
important to the little
safeguard it for him
as
as
being whittled
This,
it is to
man as
we
it
we preserve
The freedom of small business to operate
is
Garrett-Bromfield
securities industry.
also, by this attempted proposed revision, contrary
best traditions, assumes the guilt of those charged
our
we
Gy L. Cole Joins
we
late and attempt to tax the
States
Treasury.
intent of the Congress.
view,
United
the
and
gress
is not exercised by the
disagree because, by a clever
use of semantics under its rule-making power, the Com¬
mission does evade the will of the Congress and does legis¬
this
of the
government and of the fiscal and
debt management policies of Con¬
It will be said that this pow er
With
System
Reserve
from the Executive branch
to
power
mining operations; (b) for
Federal
the
of
fined and circumscribed.
SEC.
and
restoration
the
and
rency;
maintenance of the independence
continue
Commission
our
verting the national debt into cur¬
Small Business.
at all, the limit of that power must be clearly de¬
The
gold;
correction of
this
to
of
ounce
of $35 per fine
the ending and
practice of con¬
rate
statutory
seek
to
gold standard."
a
evils, Dr. Spahr recommends
and
anything, it definitely hinders rather than helps
power
under
As solutions to these weaknesses
small business.
on
a
tained
garish montrosity, which the SEC seeks to saddle on
Regulation "A" offerings, should become a part of the law.
mittee
they could give our peo¬
dollar with greater stability
purchasing power than was at¬
currency
this
come
that
they were freed from the re¬
straints imposed by a redeemable
our opinion, Regulation "A" offerings were an out¬
of those hearings.
It could never have been intended by Congress that
The time has
estab¬
Reserve
if
In
If
Federal
the
of
the
since
record
on
System in 1914 after claiming
aid of small business.
crop
our
lishment
of determining ways and means of coming to the
If the SEC is
proposed revision contains a list of supplemental
instructions dealing with the preparation of the offering
circular (a) for issuers engaged in mining or exploratory
The
level
Committee
purpose
of
power
the
purchasing
dollar to the lowest
drove
"They
of the key States of our Union, the Congressional
on Small Business held pqblic hearings for the
many
independence of the
proper
Federal Reserve System.
and prosper
gradually by the SEC.
away
counter market.
The
presently used letter of notification
Scores Unsoundness of Our
contains the
following legend:
"If
none
half
of,
Walter
of the securities
or
on
rities
This,
behalf of,
are
no
to be offered by, on
be¬
for the benefit of the issuer, the letter
notification may
by,
are
of
for the benefit of whom the secu¬
to be offered."
doubt,
was
intended for the benefit of the
promoter or other large minority stockholder who owned
securities in the company prior to its making a Regula¬
tion "A" offering and who had no control in the manage¬
minority stockholder could not get
the management to sign the letter of notification, then he
would find relief under this provision.
question, naturally, arises, not being in control,
how could such a minority stockholder, whom a manage¬
ment refused to cooperate with, get the necessary data
The
comply with the requirements of the proposed revised
letter of notification and the offering circular?
to
engaged in mining or exploratory
mining, how could this minority stockholder get "the na¬
ture, of the title under which such properties are held or
proposed to be held," or the areas in which there is
proven ore as distinguished from probable ore, or the per¬
tinent reports supporting such data?
If the issuer
were
engaged in the oil and gas indus¬
tries, how could this minority stockholder get the geology
which would support the estimate for the reserve net to
the issuers' interest in such properties which are proved?
How could he get from the company the information con¬
cerning "the development which has occurred to date on
or near the properties held"?
the
of
causes
unsoundness
the
currency
of
States, by action of
the
by
fiat
Na¬
"Despite
'A
cur¬
ards,'
once
in office, they took
following steps," Dr. Spahr
said, "to weaken our currency:
the
suspended
gold
They required the people
relinquish their gold to the
United
States
Treasury
receive in return
fiscal
indicates
of
fiat
of
for
money,
dollar,
and
contracts.
ous,
proposed revision
are so numer¬
involved, burdensome and costly, that they really
constitute
relation to
a
a
nightmare.
Certainly, they have
Congressional enactment which
terms
no
place in
was
intended
They
of
as
other
of
forms
They
all
in
depreciated,
our
by
dollar in
sometimes fixing
of gold by 'a combina¬
tion of lucky numbers.'
gold,
the price
"They
lar.
devalued
They granted
sidies
The intricacies of this
except
depreciation.
the gold clause
force, the value of
by the SEC
ex¬
currency
the
its proposed revision.
and
devaluation
for
Clearly, the Commission has provided
or
the
They
authorized
by the
government.
They provided for the issuance of
abrogated
administered
either
government.
our
the
as
to
moral bankruptcy on
or
part
and
irredeemable
an
which
currency
get the necessary data to prepare the financial statement
required under the proposed revision to Regulation "A"?
stands
pay¬
ments.
to
the
a
valued
silver
cates
tain
for
large
into
an
gold
interests
and
volume
and
of over¬
silver certifi¬
To
main¬
scarcity
they
permitted
of
under pressure
the
the
Mr.
partment.
law.
Treasury
to
of
Con¬
it.
of
They
German
Russia
gave
Godfrey Bligh On
European Tour
Godfrey Bligh, President
occupation
currency
M.
Smyth
79
Inc.,
Italy.
and
erland
Co.,
&
she desired, some of which our
redeemed.
T. J. Costello Joins
reserve
Federal
of
re¬
Albert Frank Staff
Reserve
sion
of
tem, by
devices,
law,
this
that
Sys¬
and various other
in violation of the
some
possible
made
additional
and
And
currency.
at
expansion
deposits
time
one
of
notes
of
approximately
They authorized
$95,000,000,000.
the Federal Reserve banks to pur¬
chase
rect
the
into
sound
the
They
practice.
Federal
selves
Reserve
banks
a
un¬
permitted
banks
load
to
di¬
Federal
an
convert
and
them¬
it
They
Reserve
weaken
the
permitted
of
York
City,
W.
Howard
the agency.
Burnside Director
Ltd.,
announces
Col.
Mortimer
of
Chairman
tors.
New
York
authorities
maining surplus, and nearly 92%
of the total capital accounts, of
banks
They permitted the
to create a huge
banks
of
reserves
for
member
against uncollected checks
and drafts in violation
poses
of the pur¬
of the law relating to mem¬
ber bank reserves.
of
as
Direc¬
of
Co., Inc.,
City.
Inv. Service Adds
to
accounts of
Reserve
banks
by
(Special to The Financial Chronicle)
DENVER, Colo.—Albert G. Fin-
added
volume
of
Board
Col. Burnside is President
1947-1951, nearly 157% of the re¬
banks.
Burnside
B.
its
election
the
Mortimer B. Burnside &
nell, Mrs.
those
Syndicate,
Ventures
Chemical
giving to the Treasury, in viola¬
tion
of
law,
during the -years
Reserve
131 Cedar Street, New
it was announced by
Calkins, Chairman of
Law, Inc.,
the
of
capital
Federal
Tribune"
staff
New
the
of
into
much
Federal
a member
editorial depart¬
York "Herald
since 1940, has joined the
Albert Frank-Guenther
financial
the
ment
of
heavily with Federal debt
to
currency.
the
is
and
money
of
Costello,
J.
Thomas
directly
This is
of converting
commercial
and
securities
Treasury.
means
debt
$5,000,000,000
States
United
from
to
up
value
circulation.
artificial
silver,
Treasury,
a
silver
pushed
dol¬
series of sub¬
our
was
the
of
Exchange.
of R.
Wall
copies of our money plates from Street, New York City, is making
which she printed such amounts a tour of England, France, Switz¬
an
to
of
approval
or
quirements
to be preserved at all haz¬
"They
Treasury
members
Street,
Perry & Co., Inc. for many years
in charge of the retail sales de¬
banks to permit a greater expan¬
gold
no protection
minority stockholder who is out of
sympathy with the management and opposed by the man¬
agement, to dispose of a Regulation "A" offering which
tie intends to make. As to him, no safeguard exists either
Spahr
Walter E.
sound
rency
the
"They lowered the
elected
of
pe¬
en¬
and the Treasury redeemed
Treasury
govern¬
1932
the
violation
permitted
some
as
the leaders of
in
in
money
gress
of
the promise of
of
substantial
t
Policy.
the
a
we
II.
War
permitted
knowledge
04
on
Monetary
ment
for
after
issue Allied Military and Occupa¬
tion Currency without the prior
Com¬
mittee
months
19
World
They
Econo¬
tional
of
and Federal Reserve banks to issue
Vice-
mists'
industries
war
"They
Walter E.
portation
now
formerly with John G.
Spahr, Execu-
engaged in general, commercial, finan¬
cial, or industrial business, how would the minority stock¬
holder, who is opposed by thef controlling management,
it
Cole
are sum¬
the
650 Seven¬
Stock
tered
Dr.
associated with Gar¬
become
rett-Bromfield & Co.,
Midwest
ities,
marized
Chronicle)
Cy L. Cole
teenth
riod
holding
as
govern¬
with¬
to
—
—from
United
our
Colo.
DENVER,
interests,
Cole
(Special to The Financial
hold silver—a strategic war metal
ment and Federal Reserve author¬
the
under the law
silver-subsidy
L.
Cy
Economists'
leading to devaluation of the dollar.
prohibited
for
of
Monetary Policy, summarizes develop¬
on
has
The
of
were
If the issuer is
Monetary Policy
Executive Vice-President
President of
If such substantial
If the issuer
ments
tive
ment of the company.
Spahr,
National Committee
be filed by the person or persons
or
E.
They impaired
Mrs.
Lila
to
Service
Norma A. Morris and
have
Murch
J.
the
staff
of
been
Investment
Corporation, 444 Sherman
Street.
With Clement A. Evans Co,
(Special
to The Financial
ATLANTA,
Bagwell
has
Clement
A.
First
Ga.
joined
EVans
National
Chronicle)
Nettie G.
the staff of
& Co., Inc.,
—
Bank Building.
Volume 176
Number 5154
The Commercial and Financial Chronicle
...
1
'
(1137)
profit
Continued from page 2
(disregarding
mission,
etc.)
about 111% of
nothing; methods being only the
accumulated
current
experience of others
Fiduciary Management, Inc. and
subsidiary — Resort Airlines,
affect
its
Inc.—have the benefit of the
agement
and
advice
of
whether
his
scale of
man¬
in
domestic
annual
Davidson, Jr. and the guidance of
■directors, Clinton Davidson, Sr.
would
•end
affords
•company
vehicle
a
;at times financed and
managed
men of proven
ability.
JOHN
B.
by
the
SHOBER
Selections
Based
municipal bonds.
bought
by
inflationary trends
indices
her
by the objec¬
different types
of stocks for
different
needs. I do not
think
the
stock
"like
I
best"
be
c a n
generalized to
cover
a
variety
of
The
purposes.
choice
would
depend wholly
the end in
on
view.
John
B.
"like
I
Shober
stock
best"
1
for
certain
a
wealthy client, might be a
priced low dividend payer,
high
with
clear
prospect of handsome ap¬
preciation and capital gains. The
5.2
6.0
40
29.6
37.0
8.7
of
further
vestment pro¬
59.2
11.6
you
gram which is
66.6
the
12.3
entirely
plunge
into
without
plan
74.0
13.0
chanical? Here
111.0
15.6
is
148.0
17.4
method,
cited primarily
for
200
250
and
185.0
18.5
222.0
19.5
400
plicity
296.0
20.8
than
For
reverse
to
checks
those who
25%
trial
consider a 20%
decline in indus¬
railroad stocks likely
average
and
during
the
months,
next
six
the table
a
and
spond
dividends
would
When it
individual
.-standard
careful
the
stocks,
answer
analyst's
is, of course, that
analysis
is
to
would make
in
her
would
material difference
of living.
She
justified, in view
be quite
of the
high
a
standard
annuity, in reaching for
return, even to assume
to
I
a
this
and
on
discuss
best"
is,
and
transaction,
paying
dividend.
and
the
becomes
thereby
be,
the
table
/\f»n
4-Vk
r\
4-
also
who
its
twelve
finally confronted with the
tion
whether
Which
is
such
possible
or
tal
declines
to
far
anticipatnig
in
of
excess
could, and should,
long-term capital prof¬
reaching beyond the
150%
range.
realized
and
to
that
viously
is
sidered
extent,
no
in
offset
capital
incurred,
the
factor
taking
to
no
to
tax
be
obcon-
long-term
profits.
—
FRANCISCO,
gomery
least
and after
Calif.-AICalif.—,
each
in
case,
what the
calculate, in
dollars
and
cents
profit would be before
tax, and how much of
rt
bert G. Martin has become affiliaffili
New
York
Stock
Exchanges.
.^growth records and growth pros¬
pects
-xibove
in
stock
market,
declines
the fol¬
as
lowing three outstanding growth
stocks
can
illustrate:
Dow
1941/42
Chemical
34%
Monsanto
25%
29
30
39
Dow-Jones Indus¬
trial Average
29
25
Standard & Poor's
24
25
Reference
studies
merous
;and
is
market
made
on
to
the
nu¬
characteristics
behavior
of
specific
qstock groups.
However, should it appear that
excess profits tax is likely to
the
be
dropped
growth
a
next
year,
many
stocks, which now carry
heavy
burden
of
EPT,
would
this time probably perform favor¬
ably as compared to overall mar¬
ket averages.
for the
Colo.
1-*
TYT
_
*■
1
!
_
*
_
*1
J
1-
in the form of percentage Jay B. Worley have joined the
figures. The first column shows staff of
Hamilton
Management
way,
as
price;
a
the
capital gains Corporation, 445 Grant Street.
percentage of the cost
second
column
shows
tax;
the
by how
third
column
indicates
percent, related to
price, the stock would
many
sales
have to go down in each case to
make up for the capital gains tax
(disregarding
sales
commission,
etc.,
and dividends).
For
each
percentage of pre-tax profit, re¬
lated to cost, there is a corre¬
sponding
percentage
of
profit
after tax, as well as a
percentage
of tax to sales price (column
3),
regardless of the dollar and cent
amounts
stock
more
sold
30
the
involved.
which
Thus,
bought
was
if
at
a
20
than six months ago, is now
at
50,
26%
150%
capital
Roth is
van
&
now
Colo.
—
Charles
with Bosworth, Sulli-
Company"Inc.;"660~17th
Street.
With Founders Mutual
(Special to The Financial Chronicle)
DENVER, Colo.—Robert Jasper
rrtl
•
J
That
zone;
do
the
and steady income. You may want
plan
Plan designed primarily for
a
capital appreciation.
William A. Miller Now
With Crowell, Wee dor,
—
buying in the upper
is a sell signal
no
upper
reduce stockof the total in-
zone,
holdings to 25%
vestment
capital. When there is a
buy signal in the lower zone, instockholdings to 75%.When
crease
in
buy
a
sell sig¬
or a
William
middle
the
A.
Miller
(Special to The Financial Chronicle)
LOS
ANGELES, Calif.
liam A.
(Special to The Financial Chronicle)
—
Miller
Wil¬
has become
howlnes''toTS
nas oecome asso¬
,™e,s position ld!"glV° aJ.5r{° "afed with Crowell, Weedon &
invested
in
the
early
c0>, 650
South
stages of
during
bull market, and reto a 25% invested
a
them
a
asso-
Spring
members
of
at
the
top,
profit for
*«ta1 1
i
Los
Angeles
Exchange. Mr. Miller was
formerly in the trading departof
Fairman
&
it
does
make
a
and lets you sleep
4* 1
r\
w\ a
well in the meantime.
any
The
operation
inside
FRESNO.
of
—
with
Melvin
Hall
•
JL
HaliT
&
.
America
Joins
a
to
information.
good
have
Most
no
between
a
Building.
Stock
have
pian is better than
difference
a
Bank
than
Calif.
Cappleman'is
Operations
is far better to
of
Joins Hall & Hall
(Special to The Financial Chronicle)
.
Plan in
a
Co.
to
easy
but
you
4l/v
Street,
the
st0ck
ment
under¬
easy to apply. It does not
get you in at the bottom nor out
program,
plan.
a
plan
nTpln'Ts thaTlhe planner
Quincy Cass
(Special to The Financial Chronicle)
LOS
ANGELES,
Calif.
—
O.
Carol Saunders has become affil¬
iated with Quincy Cass Assoc!bers
™ ?******& g££
of the
StocL
g
s
Exchange.
market does. For he knows under
what circumstances he is
buy
or
sell
and
how
going to
much.
He
ders Mutual Depositor Corpora¬
tion, First National Bank Building.
Samuel Franklin Adds
(Special to The Financial Chronicle)
LOS
ANGELES, Calif.—Robert
L. Starkey has been added to the
staff of Samuel B.
Franklin
_
pared,
will, in all likelihood
you
be carried away
your
greed,
wishful
by
your
your
fears,
emotions,
or
your
very
most
few
ever
investors
Company,"215"west
f
.
Seventh
St.'
cr
Joins Witter Staff
thinking.
It may be well to point out that
achieve
or
a
plan;
traders lose
or
pull out. It takes the very highest
i
Pr^aruy for safety of principal
When there
in
pared in advance for any contin¬
gencies. And if you are not so pre-
Renyx, Fields Adds
investors,
upper,
no
has become connected with Foun¬
fax Street.
institutional
is,
isn't worried because he has pre¬
Renyx, Field & Co., 810 East Col-
net
*
knows in advance exactly what he
is going to do no matter what the
profit of
tax,
Do
the best
A.
in¬
middle, and
selling in the lower
zones,
zone.
plan
(Special to The Financial Chronicle)
DENVER,
•
»
Industrials.
Market
of cost; after
gains
price
It
Join Bosworth Sullivan
DENVER, Colo. — Homer C.
Biggs has become affiliated with
the pre-tax
is equal to
Dow-Jones
Importance of
before
the corresponding percentage
fig¬
ures after 26%
capital gains
and
.
you
the
as
As stated at the outset, this is a
S.
for
take the highest high for the last
36 months, and the lowest low.
Divide this range into three equal
simple
stand,
Duane
—
invariably
plan gives
wait
Buy?—Take the
-
position in the early stages of
following table is designed Dowis, Hugh L. Grauerholz, Edd
the picture in a general T. Keen,
Betty M. Sullivan, and
profit
_
bear market.
(Special to The Financial Chronicle)
DENVER,
▼
the
__
Francisco
show
to
tax,
1946/47
38
—
DuPont
The
the
Percentage Decline
Stock—
up
even
or
cyclical
average,
the
protec¬
a
San
Five With Hamilton
capital gains tax.
are by no means
against
average,
*
and
to
preCeding three-year range for the
a
market decline in the stock would
be necessary to make
tion
Co., 425 Mont¬
members of the
Street,
and
a
following
the
in cash.
(Special to The Financial Chronicle)
legion.
college endowment funds,
are committing their investment
funds to planned programs. These
plans are available for your study,
Bld> of course, they are designed
weekly low. Ex-
to
patience
Large
ing low downward.
Much
mind,
profits. For
such
20-
a
zone,
adjust
holdings to 50% in stock and 50%
Davies Adds to Staff
SAN
3AN
Compute
in
noted
there is either
ated with Davies &
is not difficult to
three
are
answer.
Similarly sell when the
current high penetrates the mov-
nal
but
Buy?
for the
as
lower.
are
market
is
evitable decline, and then the for¬
titude and the cash to
jump in
with both feet once the
decline
has run. its course.
upward.
v» n
25%
losses
ques¬
likely,
the
paragraph, buy when the current
iow penetrates the moving high
quite
are
decline
a
v* tmrtr
long-term capital gains,
gains tax is of course
have
months
cept
of
Finally, to the extent that capi-
the conclusion that cer¬
tain of their stocks
currently held
may well slip 20% to 30% in the
to
t
it
to
another
narrow,
some
gross
reached
six
the
appeal
makes
It
specific observation may
t>e made in passing—well-known
for
moving average of the Dowjones industrial weekly high and
How
The
investors
At
rather
reducing
particular stock is likely to
-tollow a course independent from
prevalent prospective trends. At
one
has
when
the transaction.
taking long-term profits and pay¬
ing the 26% tax on such profits.
reasonable view whether
more
of
peace
and
week
expected market
•each individual situation in order
a
cellent results
tal, U. S. & Foreign Securities, or
and
generous
a
stock
advice
A plan, any
plan, puts the odds
in your favor. It
gives you sweet
Lehman Corporation.
extreme, that is in cases of
profits exceeding about
decline
quite another choice.
Those
in
the
or
ity, although it
is giving ex¬
to
especially true where the
is
the tax
security
should
cost,
150% of cost, the margin between
fund, of a church,
library, hospital, or something of
"like
of
competent dentist. Yet,
of
investors
who
a
number
year to buy or sell. The rest of the
time the investor should sit
tight.
Homer Fahrner
pre-tax
I "like best" for the
small
that sort. Here
again the
the
well-covered
endowment
I
is
stock
other
might ramble
one
warrant
150%
see
its qual¬
certainty;
prudent business, risk,
sufficient
diversity
can
be
the
and
not certain—makes it worthwhile
that
sim¬
rather
to
seems
view of the fact that the
expected
market decline is not a
a
moderate
if
40%
in
to form
required
its
'"questions to ask and
about
case,
next
to prospects for
comes
twelve
judg¬
When
A look at any chart
shows that
there are only two to four
times a
What
buy? when to buy? and how
Where pre-tax
gains are much much to buy? Let us settle the
below 40% of
cost, some inves- first question by selecting any
tors may not
consider the net listed closed-end managed investprofit (after tax) large enough ment
fund, such as Tri-Continen-
re¬
inflationary trends. In
the difference between
3% and 6% in her dividend check
her
re¬
Stable?
to
own
trusted.
be
one
300
20%
Would Growth Stocks Remain
me¬
150
so
market
the foreseeable future.
in¬
sell.
or
realize that
you are sick you go to an experienced doctor; when you are in
legal trouble you go to a qualified
lawyer; if you have a toothache
9.8
realistic
buy
your
to
10.7
100
before
provide her with all she
In her cSse, as
high a yield
value
not
90
Can You Really Afford
Not Taking Profits?
in
a
is
51.8
take
cession
up
fields
some
ment
to
judgment to
80
'Continued from page 3
business
about
go
in
of
44.4
,*Tt
a
you
setting
kind
70
obvious that investors
tfoegin to anticipate
ing methods prompts this article,
A logical question
is: just how do
7.4
50
when it is advisable
year
increasing interest in trading-with-the-trend or no-forecast-
sug¬ many years.
fairly good stock can produce
gest that it is reasonable to take
In every inis obviously the stock I "like
best" some
long-term
capital
gains vestment account there
for
her, preferably one whose where
pre-tax gains are between
as
exam¬
the
18.5
22.2
to
periods of the
The
4.3
25
secured.
For
ple,
would
needs.
14.8
30
de¬
have
In my philosophy, the title "The
continued inflation would
Security I Like Best" is one that
themselves, the annuity
has to be classified
tive in view. I "like best" entirely
3.4
trading-with-the-trend formula under
buy and sell?; How much to buy and
buy and sell? Says there are only two
to
60
husband years ago
present
to four
2.4%
11.1
20
her income. This is
sure, as far as
dollar value is
sure, and if the
Investor's Status
on
7.4%
15
painfully reduced her level of
living, provides the major part of
Partner, Woolfolk & Shober,
New Orleans, La.
(1) What
sell?; and (3) When
Sales Price
than his
An
ceased
the topics
of Gross
% of Cost
Conversely, another client is an
elderly client of moderate means.
annuity
Mr. Fahrner explains his
^
%
as
r
Registered Investment Adviser,
Corning, Calif.
intermediate
Net Profit
capital appreciation.
those wishing to invest in
special
venture situations,
selected and
By HOMER FAHRNER
for the
up
(disregarding
and
10%
For
for
tax
of
% of Cost
or
expenditure, and the bulk
of it comes from
Simple Automatic Investing
or
Gross Profit
him, I might suggest one of
Raymond Hartz. This closed- the quality
chemicals, or a mutual
non-diversified
investment fund whose
primary objective is
.and
gains
7.80,
price
sales
Tax
living. His income is al¬
more
or
dividend payments).
not
economy
com¬
22.20
decline
in order to make
commissions
client,and the
return
ready considerably
Clinton
the
capital
it
6%, is of little
consequence to this
difference
to
from
50,
would be 2V2% or
and money the accumulated
capi¬
tal.
have
15.6%
dividend,
be
cost, and the stock
would
The Security 1 Like Best
sales
would
29
(Special to The Financial Chronicle)
LOS ANGELES, Calif.—Stanlep
H. Ritter is
now
ter & Co., 632
with Dean Wit-
South Spring St.
\
The Commercial and
30
with
nationjftncome. Notes also
3.4% of
living within their income,
Tax collections by
smce
dollar
high
for
of
total
Social
This
preliminary
the
in
the
(40-50%)
marked
Details for each
Carolina
given, but Califor-
.tate cannot be
sales
nia took in about $416 million for
V.
Wyckoff
J.
its
gains
general sales tax, Michigan $2a6
than
in
million, and Illinois $192 million,
is
com¬
drop
of
pared with $59.38 for 1951, or ap-
corporate)
gave
of
yield
a
a
that
fact
48
the
not covering
group are
while. Nor are we in¬
clined to spend 20 minutes of our
and
time
even
charges)
and
which
IP4'*
since
from
increased
$2.4 billion to $6.4 billion in 1951,
almost
with
certainly
three
a
staff
the
of
all
After
a
Pentagon
Yet
pennies
make up dollars,
thousands mil¬
ladder.
cumulative
the local levels of
the
And
since 1946.
deficits of the
annual
since> 1931
Federal* Government4
general
(except for 1947, 1948, and 1951)
are causing omshould cause grave
fiscal
The
concern.
with a
South Da-
general.
dollars thousands,
government
were
in
only about .0000008% of the mul¬
ti-billion dollar Federal budget.
taken place on
South
stamp
colonel's total pay is
a
figure for 1952 when made known.
The same deficit financing has
ex-
cent
Congressmen ques¬
our
tioning the appointment of an¬
other public relations colonel to
higher
a
item of sev¬
the
an
ly worth
writing to
expenditures with
in recent years
general revenue (taxes,
nor
quite equalled
general expenses.
This is
shown by the mounting state debt
other hand
less in 1952
and
15.5%
as
such
Delaware
1951,
new
a
eral thousand for redecorating
general
aid,
year
United States Treasury just
June 30
kota 7.3%.
Net income taxes (individual and
„
,
proximately $250 for each family,
Adding the heavy federal tax bill
and the local levies would bring
the total to roughly $540 for each
new
the
On
collected
states
two
their
from
taxes.
disturbing
legislature about
taxes,
has
The -most
increase.
chalked up by Georgia and
sales and
productive geneial
net income bases.
the
amount
this
ceeded
states
Sixteen
1951.
than
state
every
protest
remonstrat¬
average)
the
(about
their
larger
the
1951 total.
$64.48,
fiscal
parentheses
table that not
this
10.1%
A
over
Governor's mansion appears hard¬
go
their
of
collections
state tax
1952 were
taps each of the tax sources, even
of the
Per person
in
the numbers
from
Census,
is
10.1%
above
the
Total
mayor
ing with our representative in the
the
California.
respective
the
for
figures
local
increased taxes,
more often to
states
govern¬
has been
because a
as
also
but
our
collections
tax
dollars?
higher taxes and "want their tax
money's worth"?
Whatever the sequence there is
com-
unadjusted for population or
price changes. It will be noted
Divi-
of
o n
Bureau
others,
by
mentioned,
years
by
Govern¬
ments
local
to
left
functions
to
of
public officials for help in various
because
they are paying
by year; in
year
of
cause
billions
forms
the
of
summary
collections
tax
state
dollar
just
released
states
the
in
governmental
more
citizens
do
or
com¬
change of a certain amount in
dollar tax revenue bulks larger
pared with 1951, the war year percentage-wise
with a low1944, and the prewar 1941 is given budget state than the same sum
in
Table I.
These are absolute with, for instance, New York or
rity payroll
figure,
tax
do
typewriter
for
the city
clerk
seems pretty picayune.
A1§0 with
a
state
budget of $250 million
for
demands
to
^is case from 1951 to 1952. Heie
also precautions are necessary not
ments
convenient
A
1952
Secu¬
taxes.
difficult
of
as citizens and
anything about
I
and
you
taxpayers
are
government relation is somewhat
of the
hen-or-the-egg kind: do
activities precede
spective
Sources of State Tax Revenue
billion, exeluding the
by
parison is that of changes in the
total tax collections by'the re¬
states are not
of inflation.
a
more
are
sum
governmental expenditures which
This taxpayer-
tax revenue.
its
interstate
Another
Can
increased, must be matched by
service to
make.
their indebtedness is increasing
$9.8
is
as
to the
$259 billion.
governmental debt
mean
which, unless
themselves, and such
citizens
government. More
more expenditures
of
determined
be
must
measurements
part of the 10.1% increase in State
all- tax collections during this past
fiscal year can be traced to the process
the
genuine
the
the 48 States
ending June 30, 1952, with
year
i
Thursday, September 25, 1952
...
Federal gross debt
from
services
more
level
services
or
capita figures for a
collections reflect prof¬
citizens
of the Union pushed to a new
time
Whether
bottom.
per
or
for
mands
each
ligacy
$21/2 billion in Federal aid. Says state taxes amount
to almost
Ala¬
third
state's tax
DePauw University
for
1952 fiscal year, excluding social security levies, at $9.8
billion, an all-time record. In addition, says states probably
received
and
the
the
not
Wyckoff estimates tax collections of the states
Professor
lowest,
Nebraska
Jersey
next,
from
By V. J. WYCKOFF
Professor of Economics,
New
bama
State Tax Collections in 1952
s
Financial Chronicle
(1138)
icit
of
of the
ended
showed^a budgetary def¬
billion, bringing total
$4
and
lions,
so
If
on
the
up
fiscal
become
ever
can
we
convinced that when
government" spends money
thoroughly
"the
it
is
us
hard-earned
our
of
form
the
will
over
be
money
each
then
taxes,
in
of
much concerned
of expenditure by
very
trifles
public officials, both civilian and
military. If we shrug off the pen¬
nies,
we
will
the billions.
pay
$515
Pennies Make Billions
million to New York and $210 to
California.
New
Jersey
which
The fact that state tax levies Continued frOTH vacie 5
1952 were only about
J
person
(not per family) at the
rely predominantly upon the 10% of Federal internal revenue
mid-point of 1952.
taxation
of
motor
vehicle fuels does not make them unimportant.
These 1952 State tax collections grid
licenses, alcoholic beverages After all the sum involved, ' $9.8
of almost ten billion dollars are gnd tobacco
products.
With the billion, was taken by state gov"Steel Output Scheduled to Show Further Mild Rise
not a flash in the pan.
Last year Dressure on states to raise more ernments from your income and
This Week
the total was $8.9 billion which in and more funds
it is
protoWe mine. And there is no reason to
tur"
turn was on<
Steel will be,more plentiful'in the first quarter of the next'
^'as one billion more than tha( most o{ th^ 48 iegjslatures expect that next year the sum
in 1950, a coi
year, says "Steel,* the weekly magazine of metalworking,
the
,1950, a continuation of a^ con- within a few years will tax about will be less.
sistent
during this
upward trend
for
except
century
few
a
Naturally
last
but
revenue
has
be
received
aid
sure,
by
current week,
during
inrrpa^H
education
and
of
from $786 million
made
by
as
Also
charges
State
institutions, such
room
tuition,
and board at State
universities,
and
miscellaneous
items brought in about one billion
dollars
liquor store •
gross revenues of the 16 monopoly
States added another $914 million,
When
and
more,
figures
State
these
on
revenues
non-tax
released
are
by
Census, it is probable that each of
the above
sums
will be somewhat
But in general, per capita
states.
such
offers
higher for fiscal 1952.
the
which
State Taxes
3.4% of National
collection
tax
state
figures
are
significant, and the Census usually
calculations
following
,
able goods
Income
been
the
then, it further notes.
When the first"quarter is over it probably will be found that
vious
than
be
1952 Tax Collections Per Capita
California
96.51
New Mexico
91.90
most double the
than
year
yet
last,
actually the burden of such a bill
is no greater if the taxpayer's in¬
come has increased proportionate¬
Five highestWashington
Louisiana
And a flat tax rate applied to
growing tax base will really be
less
burdensome, though yielding
revenue.
(Persons
with
more
incomes
fixed
the
are
State
about
3.4%
collections
tax
of* national
the
for
figure for
when
1941
was
only
State
State
Kentucky
tax
taxpayers
a
as
dollar
more
be
tax
in
1951
"DrirPS
to
rfirl
June
rico
1952
o'nnnt
and to price
let-up by tax-
citizens
in
their
de-
From
General sales &
Motor
commodity
9of
/o.
nPU,,,-.
InUS,
fuels
Alcoholic
for
June
Tax Collections
Tobacco
Property
Death
&
and
signs headway is being made in catching up with it.
Conversion
steel as a supplement to regular supplies of steel is losing some of
its
appeal, concludes "Steel."
American
The
Iron
of
the
for
capacity
the
week
taxed
beginning
Sept.
22,
1952,
equivalent
to
2,125,000 tons of ingots and steel for castings.
In the week start¬
ing Sept. 15, the rate was 102.1% (revised) of capacity and actual
2,069,000 tons.
A month ago output stood at 99.6%
One year ago the rate was estimated at 102.1%
2,041,000 tons.
bution
1952
Electric Output
The
amount
of
Extends Gain of Preceding Week
electric
energy
distributed
by
the
electric
22.7
442
469
267
216
—5.8
4.5
light and power industry for the week ended Sept. 20, 1952, was
estimated at 7,724,664,000 kwh., according to the Edison Electric
449
430
160
106
4.4
4.6
Institute.
924
840
394
434
10.0
9.4
16.3
17.6
net
(48)
_
_
licenses
(48)_
(31,
inc.
The current total was 70,340,000 kwh., above that of the pre¬
-
1,736
1,492
762
422
370
346
247
268
6.8
3.8
211
33)
___
__
__
__
_
_
Tax
Census,
,
4
196
112
118
7.9
2.1
222
1,228
646
9,838
$8,934
$4,065
53
22.6
2.8
501
8.6
13.5
$3,606
10.1
100.0
71
1,334
-
ceding week when output amounted to 7,654,324,000 kwh. It was
710,714,000 kwh., or 10.1%, above the total output for the week
ended Sept. 22, 1951, and 1,267,634,000 kwh. in excess of the out¬
of
Collections
in. 1952
(similar
source
for
prior
years),
Washington, August 1952.
The figures in r parentheses
using that particular tax source in. 1952; 31 states
states
-
-
.
0
.
,
individual net incomes, 33 states taxed corporate net incomes. The Social
unemployment compensation tax receipts are not included in this table.
Security
the
19.0
272
number
that
9.4
sales
State
the
announced
11.4
collections
Reference:
Bureau
Institute
capacity for the entire industry will be at an average of 102.3% of
Car
indicate
Steel
913
sources
tax
and
operating rate of steel companies having 93% of the steelmaking
put reported for the
Total
being expanded.
although there are
are
strong,
%
Distri¬
1951 to
'
capacities
continues
$575
(41)
(47)
making
steel
685
_
gift
coke
finished
$721
(24)
tax
and
1,710
opers.
corp.
for
Demand
expansion
$2,001
(45)
Severance
Other
&
furnace
some
of the growth of steelmaking capacity, the nation's
In support
blast
caused
1,871
__
_
beverage
e
115.6
This is somewhat below what had been
journal.
for economic considerations
plans to be scaled down or dropped.
and production at
from
1941
1944
1 will be around
receipts (31)__$2,229
gross
products
Individual
(Prelim.)
(48)
Motor vehicle
% Change
.t
1941
1952
1951
1952
AND
next Jan.
expected,
output totaled 2,121,000 tons.
1951, 1944,
1952,
(Amount in millions)
SOURCE
(and number of states using
mind.
collections
supplies.
as
SOURCE:
MAJOR
BY
-
housekeepers, and in a period of
rising prices must pay more for
help (including school teachers)
all
COLLECTIONS,
TAX
a,
prior years do
not necessarily mean that heads of
State
departments
are
wasting
money
or
expanding
services.
After all,
governments also are
for
TAX
burden¬
fiscal 1952 than for
and
payers
in the year.
but
tons
net
adds this trade
or
STATE
aspect of tax
kept
rises, there is no
list,
the tax in 1952)
one
figures should
Larger
the
led
growth
to
TABLE I
decade ago.
At least
California
and
ascribed
be
can
population
Washing-
for
the
group
more
was no
35.83
Louisiana,
taxes and govern¬
revenue
Thus
(relative to income) than
some
Jersey
year
continuation of
a
interference from the steelworkers' strike,
construction workers, shortages of materials
enough additional facilities are to come in
after then to boost the figure in 1953 to around 120 million tons,
million
part,
aid
mental
Last
prob¬
part, and at times a
of the upward
a
trend lines for
41.68
New
ton,
Although
substantial
43.28
Nebraska
are
even
44.15
available
trends.
these
45.75
Alabama
1942 figure. And
when
data
ably will show
Missouri
income.
and
billion.
$3.6
1952 tax bill
1951,
85.71
_
Five lowest-
This percentage is almost the same
as
1952
hard
ones
rising tax rates, as they are
by higher living costs, a form ot
taxation.) On a nationwide basis
1952
102.70
Arizona
hit by
the
$102.72
There was
Steelmaking capacity on
of
spite
States—
This gain is somewhat less than had been ex¬
tons.
and "bad weather early
a
this
higher
his tax bill
will...
Gain from Jail. 1, 1952, to Jan. 1, 1953,
July 1.
labor troubles among
lections have mounted
see
last
on
7 million
pected/
ly.
likes to
one
three
high by that time.
A survey by "Steel" shows steelmaking an¬
nual capacity by next Jan. 1 will be 6.3 million net tons greater
greater Federal grants
year-by-year. The same story can
be
told
of
local
governments,
which in 1951 in spite of an esti¬
mated $4.3 billion in
state aid
collected $8.6 billion in taxes, al¬
No
shipments in that period were greater than in any pre-,
months.
Steel capacity will have reached a record
total steel
As
case.
the first quarter,
quarter, this trade journal notes.
The military'^ first-quarter allotments will be about the same
as those of the third quarter but the military will have no carry¬
over tonnage coming.
All of its back orders will be filled before
mentioned, state tax col¬
steadily in
has been
culled:
not
This has
been
should get what they are allotted for
plus what is due them from fourth
directly on the lower levels.
from
have
of the third quarter of 1952.
Technically that's^true,,, but that isn't the whole story.
Firstquarter allotments are being held that low so orders carried over
fromTourth quarter can be filled.
Producers of consumer dur-,
ments
Inch Vntpr"
to about $4 3 billion•
governmental revenue movements
do not alter the total natl0nal tax
bill because money paid over by
a state to a county tor welfare
™ust oe raised by tne state
through its taxes. Bdt one would
expect that with each of the
lower levels of government reeeivmg ai? increased amount of
aid from th-e next higher one, that
fewer taxes would be collected
will be realized that interstate
contrasts must be interpreted with
some degree of caution because
states will tax according to state
expenditures, and in some states
local governments (counties,
townships, municipalities, and
special districts) bear a greater
share of highway, a welfare, and
educational costs than in other
goods would be only 60%
durable
re-
for hun-
in
came
millions.
dreds
States
the
1951)
first-quarter allotments are apt to be,
interpreted as meSning there will be less.
The National Produc¬
tion Authority announced first-quarter allotments for consumer
increased during
lections of other states. State-by- in 1942 to $2.4 billion in 1951,
ceived $2.4 billion in aid from the
data wi?1 have to be obtained the laJest available flgure. In the
Federal Government
mainly for
directly from the Census report same ten years aid paid by states
public welfare though highways on which this article is based. It to t^eil! respective local govern(fiscal
vear
£%
Government reports of
states from the Federal Govern-
an
.
the maior
are
sure
State
of
source
he
to
To
base.
person
eacn person nas an
ctpnrtiiv
interest in a comparison of his ment steadily
state tax revenue with the col- the past decade,
dunng the depression of the 1930s.
Tavac
each
f°r fiscal
had
sources
major productive
every
years
these
neither of
uses
corresponding period two years ago.
Loadings Make Substantial Gains in Latest Week
Loadings of revenue freight for the week ended Sept. 13, 1952
totaled
881,218
Railroads,
cars,
according to the Association of American
an increase of 135,174 cars, or
18.1%
representing
Volume 176
Number 5154
...
The Commercial and Financial Chronicle
(1139)
above the preceding
holiday week. Excluding LCL merchandise,
loadings of carload freight in the week ended Sept. 13 exceeded
all
corresponding weeks since 1942.
est
Ore loadings were the great¬
reported.
ever
The
week's
total
represented
an
increase
of
30,406
cars,
or
the staple last month, as estimated
by the New York Cotton Ex¬
change, showed a moderate increase, and for the first time in sev¬
eral months displayed a
gain over the year before. The total for
the four-week August period was
If you can arrange
it, there should
be time devoted by one of the
managing partners himself
760,000 bales, against 754,000 in
the similar period
a
above the corresponding week a year ago, and an increase
14,560 cars, or 1.7% above the corresponding week in 1950.
educating new men in an
understanding of "what makes the
United
States Auto
Passenger
In
most
production in the United States last week
soared to its highest point in 1952 to
105,135 cars compared with
102,763 (revised) cars in the previous week, and 100,299 cars in
the
like
car
week
a
year
according
ago,
"Ward's
to
Automotive
Reports."
Total
output for the past week was made up of 105,135 cars
and 28,048 trucks built in the United States
against 102,763 cars
and 24,933 trucks (revised) last week and
100,299 cars and 28,242 trucks in the comparable
period a year ago.
Canadian plants turned out 6,356 cars and
2,955 trucks against
6,509 cars and only 3,101 trucks last week, and 4,534 cars and
Business Failures Rise Sharply
ended
Sept.
and
industrial
failures
to
rose
in
145
the
week
from
18,
91 in the preceding week, states Dun &
Despite this upturn, casualties remained slightly
below the 160 and 155 which occurred in 1951 and
1950, and were
down sharply, 39%, from the
prewar total of 239 in the similar
Bradstreet, Inc.
week of
$5,000
or
more
Casualties
in
involved
were
this
size
in
117
of
the
increased from 71
last week and exceeded the 11-j
occurring in the comparable week
a
year ago.
An increase also took place among small failures,
those with liabilities under
$5,000, which rose to 28 from 20 but
All
trade
industry and trade
'
.
in
mortality.
where
against
group
below their 1951 level of 44.
increases
■
37.
parts of the nation bought
The
twice
over
More
retail
groups except commercial service had
sharpest
as
many
businesses
jump
appeared
in
succumbed,
concerns
failed
than
retail
77
as
and
1951 level, but mortality in other lines
wholesaling equalled the
was
slightly below last year.
Geographically, an increase
was
a
year
ago
in all
reported
regions except the Pacific and South Atlantic states.
Failures were higher
than last year in four
areas, including a marked rise in the Mid¬
dle Atlantic States and a moderate
gain in the East North Central.
In five regions, casualties were
lighter than a year ago; less than
one-half as many concerns failed in the Pacific States as in 1951.
decrease of 4.1%
figure, at $6.49, represents
from $6.77 recorded in the corresponding 1951
The index represents the sum total of the
price per pound of
31 foods in general use and it chief function is to show the
gen; eral trend of food prices at the wholesale level.
•
Wholesale Commodity Price Index Recedes
Moderately
In Latest Week
'
'
There was a further moderate decline in the
general com¬
modity price level during the past week. At 292.24 on Sept. 16,
the daily wholesale commodity price
index, compiled by Dun &
Bradstreet, Inc., compares with 293.29 a week earlier, and with
298.72 on the corresponding date last
year.
Grain markets
were unsettled with price trends mixed.
Soy¬
quite sharply as considerable selling pressure de¬
veloped with the start of the new crop movement. Wheat held
quite firm, largely supported by the prospect of export business,
particularly with West Germany. The Sept. 1 estimate of the total
wheat crop at 1,298,000,000 bushels, was about
unchanged from a
month ago.
Improved prospects in the Pacific Northwest were
beans declined
'
•
about offset
by lower yields in the Dakotas and Minnesota.
market was irregular.
corn
;
Export activity held
weakened
crop
,
corn
The
,
in
together with
latest
a
steady at times but the market
the result of heavy receipts of old
as
some
arrivals of
new
-
-
•(
-
:
'
;
•
-
of
or
corn.
of the corn crop placed the
only slightly larger than the fore¬
month ago.
Trade
last week
averaged 34,000,000
you
fciioppers"
attention
The
dollar
the Chicago Board
day, against
32,500,000 the previous week, and 40,000,000 in the like week last
Domestic flour
prices were somewhat easier. Demand for hard
wheat bakery flours was confined to occasional small-sized bookings. Shipping directions were maintained at a fair rate, reflecting
some
pick-up in bakery sales following the Summer lag. The
export flour market was very quiet. Cocoa prices fluctuated in a
narrow range with final quotations about
unchanged from a week
ago.
Warehouse stocks of cocoa declined moderately to 114,070
bags, from 121,037 a week ago, and were well below the 204,204
bags at this time a year ago. Although roaster interest in coffee
during most of the week due to the continued
threat of a dock strike, prices moved mildly lower in
closing ses¬
sions in sympathy with the easier tone prevailing in Brazil.
the threat of
a
-
~
retail
from
the
levels
of
a
year
counters
the
past week
sumer
demand
garine
was
on
apparel.
in
the
trade
nation
in
the
ago
sugar
also reflected
strong opening due to the unexpectedly small govern¬
ment crop estimate, spot cotton prices moved
steadily downward
throughout the balance of the week. The easiness was attributed
to profit-taking, hedge selling and liquidation influenced
by the
a
proximity of the seasonal heavy hedging period.
Consumption of
television sets
in
cians
remained
to
consumers'
meet
m
were
slightly
current
Reserve
than
hurried reorders of
many
that
Fall
of
a
on
Board's
out
set
a
finished
these
tests
of
progressive
the East
had
by
emi¬
an
has
had
ex¬
retail
has
firms
tried
here
them
out
in
anc
reports well of them.
I
am
that
sure
this
is
step
a
I understand the fee foi
the
tests,
and
the
considered
opinion of the psychologist who
will rrte the applicants, is very
the week ended Sept.
13,
preceding week. For the four
weeks ended Sept. 13,
1952, sales reflected an increase of 1%. For
the period Jan. 1 to
§ppt. 13, 1952, department store sales regis¬
tered a drop of 2% below the like
period of the
of the
It
modest.
least
to
seems
will: be
it
me
that
at
helpful
in
determining who should be hired,
year.
Retail trade in New York last week
was
adversely affected by
and wet weather the latter
part of the week, which resulted
in a decline estimated
by trade observers at about 4% from the
1951 week.
and
who
you
warm
are
time
very
should
going
and
crease
According to the Federal Reserve Board's
index, department
store sales in New York
City for the weekly period ended Sept.
13,
1952, decreased 6% below the like period of last year. In the
pre¬
ceding week a decline of 10% (revised) was reported from
be
effort
your
discarded, if
spend the
to
out
needed
to
in¬
sales organization.
This is the third
or
have
I
Ferd
mentioned
fourth time
Nauheim
in this column.
that of
no
of 1951, while for the four weeks
ended Sept. 13,
decrease of 6% was registered below the level of
a year
ago. For the period Jan. 1 to Sept.
13, 1952, volume declined 10%
under the like period of the
preceding year.
1952,
who
three
has
actual case work. One of the more
taken from
similar week
prepared
be
can
perience in this field of work. In
addition, I understand that they
are
based
upon
some
intensive
theoretical study which has been
backed up by a testing period in
year
preceding
that
Nauheim
educator
nent
merchandise
as
tests
approximately
Mr.
forward.
country-wide basis,
of
in
hours.
index for
1952, fell 1% below the level
tests.
Nauheim, of Fund Services
Washington, Woodruff Bldg.,
Washington, D. C., has worked
Many merchants, particu¬
lines, encountered increasing delays
a
com¬
good enough statisti¬
that they would not con¬
Ferd
demands.
apparel and other soft
Federal
larger
of
are
so
such
scat¬
volume
trade
There
a
of
Trading activity in most of the nation's wholesale markets
continued to rise in the week as buyers
prepared for the new sell¬
ing season. As during recent weeks, the total dollar
earlier.
not
or
tinue using such tests unless they
believed they were of value. The
life insurance companies do use
tered parts of the nation.
wnoiesale
helpful
very
opportunity
average
panies
Especially in demand were washers, freezers, small
appliances,
decorating materials, and household goods.
for
be
can
think that the life insurance
year
demand
determining whether
"coming through successfully." I
The heightened interest in
many items, which was boosted
by successful promotions last month, continued a
steady rise.
the
tests that
than
more
stirred
work
prospective salesman will like the
business, and will have a better
foods, canned beverages, and oleomar¬
substantially higher than a year ago.
stations
sales
distribution
in
pronounced
New
of
the
of
for frozen
noticeably
fields
with
intangible merchandise, it has
been possible
to develop a set
slightly more than in the prior week
than in the comparable 1951 week. The
most
gains continued to be in the interest in women's and
children's apparel in the
medium-price ranges.
The demand for household
goods remained palpably higher
than in the early months of this
year or the similar week a
and
embryo sales¬
an
of
slightly more for food than in
Particularly in demand at meat
pork, poultry, and lamb. The con¬
were
other
connected
Housewives continued to spend
the similar week a
year earlier.
Certainly I have
personal interest in promoting
his business, and neither does the
a
"Chronicle."
that
he
It
just
to
seems
happenpioneering
so
be
in
the field of security salesman
ship along lines that are construe
tive. In accord with our policy r
trying to promote helpful idc
Securities Salesman's Corner
in the field
ship,
of security salesman¬
believe that this serv1'-
we
which he is offering deserves put
licity.
By JOHN DUTTON
A
Step Forward
My attention has been called to
a
series of aptitude tests for de¬
termining in advance whether or
not
prospective
sales
applicants
for
positions in the field of se¬
curity salesmanship have the
qualifications
essary
to
spending the time and
in
their
nec¬
warrant
in¬
money
development.
own
experience
to
as
how
rities
business, I think
will agree that if you
the rest of
we
in
us
who
liked
it
you
secu¬
that
stuck
were
like
Those of
to
us
it.
Many
tried it for a while and gave it up.
In fact, turnover among sales
per¬
sonnel
in
this
most
people
fairs,
unstable
in¬
dustry has been far too high.
a
for them
it
to
is
not
by the
good business
send out half-trained
representatives.
Selling securities
evolves itself into
a two-way pro¬
all men who are suc¬
cessful at it. First, you must know
and understand the fundamentals
gram
for
of investment.
pect to send
a
You
sit
back
and
financial
and
We
going
to
talk
from
ginner and
then
future
over
for
not
going
to
of
"sales
to
some
We
our
With Waddell & Reed
(Special
just can't ex¬
callow boy out to
to The
The
COBDEN,
It
training
involves
men
resent your
—
Chronicle)
Theodore
L.
Kaufman is with Waddell & Reed,
entails
With R. R. Underwood
money
and
the interested
(Special
to The
you
are
venture.
engaged
You
wood, 245 South Grand Street.
rep¬
will
Joins
Renyx Field Staff
(Special
to The Financial
ORLEANS, La.—Clifford
Eustis
is
now
with Renyx
H.
Field & Co.,
must
into the
salesman is only
put
job of traning a
part of it). There is, in addition,
study which must be completed
bv the trainee regarding the tech¬
of
investment itself.
that
your
partment has to
statistical
cooperate.
This
de¬
And,
Chronicle)
NEW
the
he
Chronicle)
MONROE, La.—Samuel J. Willensky is now with R. R. Under¬
graphic assistance, telephones, the
efforts of your sales manager (and
work
Financial
,
to go out and
firm
serious
means
111.
of
sympathetic guidance of the
entire supervisory staff of an en¬
tire organization.
When you are
nique
Financial
are
and
a
Co., 231 Sout*
Inc.
therefore
expenditure
time.
of W. T. Grimm &
training of competent sales
representatives
the
dleton has been added to the star
a
public won't do it either.
The
Chronicle)
La Salle Street.
be¬
money
talk."
to The Financial
CHICAGO, 111.—Frank C. Pen
finan¬
our
him.
invest
a
that.
listen
turn
to
for
us
not
because
wait
Money is too important
sales
are
canned
af¬
have to provide desk space, steno¬
progressive retail organiza¬
tions that
their
subject to most of
in
Training Is Essential
I think it is well agreed
about
miracles.
you
this profession—
"just happened."
W. T. Grimm Adds
(Special
talk with experienced and
mature
cial
If you will look back upon
your
most
raw
dock workers' strike.
prices again moved lower in sympathy with vegetable
oils and further declines in live
hog values.
After
"
of
In
com¬
city department stores.
largely rocused
maintained
Lard
•
was
volume
favorable
more
estimated by Dun & Bradstreet, Inc., to be from un¬
to 4% higher than a year earlier.
Regional estimates
fell into, or drifted into the
year.
was
total
up
was
varied
investment
Pre-Hiring Testing
Suburban stores continued to chalk
parisons with a year ago than did large
changed
hire
Whether
have acquired
you
expensive
man.
pers' interest.
week
learning.
not,
when
volved
on
bushels per
Increased activity in both refined and
.
crop
government estimate
Trading in all grain and soybean futures
-
The
prices
late dealings
yield at 3,185,000,000 bushels,
cast of
you do or
as
more than in the com¬
Attractive reduced price
promotions, extended
shopping hours, and relaxed credit terms helped to sustain
shop¬
the
since July 1 when it stood at $6.45.
Although still above the 1952
low of $6.31 on April 22, this week's
is
parable 1951 week.
Department store sales
week.
i
merchandise
In addition,
not, pay your
of some kind
may
salary
a
he
an
in deliveries.
Following the sharp dip of a week ago, the Dun & Bradstreet
Wholesale Food Price Index dropped another 11 cents this week to
stand at $6.49 on Sept. 16.
This marked a decline of 3.1% for
the two-week period,
bringing the current index to the lowest
a
much
as
or
quite
larly
•
trainee
ago.
Wholesale Food Price Index
Dips to Lowest Level
In 11 Weeks
■
about
around."
go
may,
while
Wednesday of last week shoppers in
Retail apparel stores sold
of
failures.
continued
on
you
during the preceding week and slightly
1939.
Liabilities
week's
the period ended
But
by the following percent¬
ages:
New England —2 to -(-2; Midwest 0 to
-|-4; Northwest 4-1
to 4-5; Southwest and South
-j-2 to 4-6; and Pacific Coast —1 to
-|-3.
1,940 trucks in the like week of 1951.
Commercial
Unchanged From Previous Week
Slightly Above a Year Ago
Output Attains Highest Level
In 15-Month Period
wheels
Trade Volume
to the
task of
year ago.
3.6%
of
31
Joins
(Special
Inc.
Hayden, Stone
to The
Financial
PORTLAND,
Miller
Hayden,
crrpcn
is
now
Stone
Strppf
Chronicle)
Maine
—
Alex
associated
&
Co.,
477
J
with
Con-
32
The Commercial and Financial Chronicle
(1140)
Continued from first page
Chemistry's Vital Role in
Developing Nuclear Power
of the
Already
is
power
one
an
example of atomic
actuality.
the private pre-
vital role of the chemist and the
cember,
AEC's
physicist. But the ad¬
chemical engineer. In addition to
technical problems, the future—
Breeder
Reactor
atomic energy is
fserve
date, but I will say that we will terials is indispensable to effecone,
or
perhaps a
few, tive domestic control of atomic
nuclear power plants
producing energy."
And the second quotation: "The
electricity for industry or central
station networks sooner than the production of fissionable material
10- or 15-year period we had been is technologically in its infancy;
unforeseen and unforeseeable facestimating a short while ago.
have
play
may
Last De¬ development.
Experimental
Idaho
in
tors
pro¬
a great part in its
To permit decontrol
decentralization of this
or
continuing Governsupervision, would be con-
duced, as one of its first acts— ment
vances
would never have been
possible without the work of other indeed, the ever-nearing future— although admittedly a secondary trary to the principle of prudent
is bringing us the necessity for act—an experimental amount of stewardship
demanded
of
the
.groups of scientists and engineers,
Government by considerations of
especially the chemist and the making a series of important deci¬ power.
sions.
■
The
progress
that
has
been national defense and national welchemical
engineer.
It was the
who
chemist
for
the
tion of plutonium from
of international condi¬
achieved
to
great
bulk
of the
atomic energy effort has been, and
activities
in
Because
Man¬
the
tions,
days, developed a
method
suitable
the
during
hattan District
separa¬
is
irradiated
aimed
now,
at
the
goal
of
military
strength to
uranium and its attendant fission achieving
products. Throughout these past help insure world peace. That is
10 years more and more impor¬ why the atomic energy program
And in
tance has attended the work of the was originally conceived.
chemists in all phases of the atom the short time of less than 10
instead of just
finished
products,
uranium 235 one atomic weapon—a family of
in an ever - increasing
«rad plutonium in bomb shapes or weapons
business—from
reactor fuel
ore
refining to the years
elements and
have
we
—
radio¬ stockpile.
However, the Atomic Energy
And, according to what
scientific and engineering col- Act foresaw other uses for atomic
The Act looked toward
leagues tell me, future progress energy.
will depend, to a very large ex- the field of civilian applications;
«tent—yes, to an ever-increasing and, with the late Senator Brien
McMahon's foresight and vision
extent—on chemistry.
IKTow, I'm not a chemist and I'm setting the pace, it looked toward
»ot an engineer.
You might call the field of civilian power. Even
me
a
"civilian member" of the as early as 1946 the addresses of
Atomic Energy Commission. Hence one of your distinguished associ¬
I rely on the technical experts at ates, Dr. Charles A. Thomas, the
the Commission who tell me that President of the Monsanto Chemi¬
even
greater challenges face the cal Co., prophetically looked to¬
chemists
in the atomic
energy ward the day of harnessing atomic
program of the future than they energy for power.
isotopes.
bave met in the past.
These are
Developments Leading to Useful
which you must solve
if atomic energy is to move for¬
ward at the rapid pace it has set
problems
for itself
For
1942.
since
these
example,
Nuclear Power
As
have noted, the
emphasis
has
been on applications for national
scientists
security with the consequent sub¬
.
we
in the atomic energy program
support
industries.
The
matter
advertised
cent
99
six months ago.
was
One
and
for
been
excited
the possibilities
ability to over¬
by
and the apparent
the technical problems.
come
This
does
not
mean
im¬
the
of
attainment
nuclear
second phase
through before
even the design of a power reactor
becomes
available.
Then,
of
course, must come the building of
There is
power.
a
still to be worked
such
per
It is,
heartening to note the
ac¬
tion of the four groups of utilities
and industrial concerns as they
indicate their desire and willing¬
ness
to invest their time, talent
the
Atomic
For
some
time,
JLet
is
intended
not
to
imply
in
any
—
list
briefly some more
the disposal of radio¬
atomic
energy used for industrial or commercial purposes.
But what can
active
tion
products
packaging
on an
of
fission
economic basis for
the
Because
the
Commission
in
is
considering
of
process
this
guaranteed market for plutonium
during the next 10, 15, or 20 years,
Before private investment could
be
attracted
we
expect
mission
know
substitute
for
of
the
effective
as a
vital element of
the Nation's defense policy.
assur-
contracts—
The solutions call for the high¬
ship.
and civilian uses of plutonenables us to give only a
tary
ium
a period of
there would he the question
of whether we would he justified
at the time.
a
and
so
simple change in the
a
wording of the Act.
The Commission
is
study-
now
ing
structure.
They
is:
How
power
do
are
vital that
so
in
tie
civilian
The
national defense
first consideration
with national defense?
requirement
is
we
always
of
the
ing beyond
It is the
at the Commission.
rea-
son
for the extensive
of
atomic
today.
been
for
need
energy
World
no
Had
War
II, no
weapons, the
advanced
made during the last 10
might have been achieved
progress
years
only in small measure.
the program must be sharply
limited, presenting the problem of
how to select companies which
would
be allowed into
of any
atomic
with
or
power
is
it consistent with
Can
carry
an
atomic
contribute
to
plant
both
be
built to
civilian
and
military objectives?
tonium carries along a companion
problem—that of the pricing forThe price formula should
certainly provide a profit incentive covering the entire operation
that is, it should take into account
both the plutonium and the power
mula.
sold
as
seller
how
out
into
being
a
new
and closely with the problem of foreseeing military requirements.
The delineation of responsibilities
at the outset is of the greatest im¬
portance in shaping future
At the present
thinking of atomic
time
we
power as
are
being
the co-product of
plutonium, both
coming from atomic reactions takin ing place in uranium, converting
courses
and
determining our success
making the most of the benefits of part of it to plutonium, and
atomic energy in our national life.
re-
leasing heat which could be used
generating electric power. All
in
Civilian
Nuclear
Power
of
us
from
the
Senate
Committee
know that the chain reaction
in uranium in
electricity if it could be harnessed
the economically.
Re¬
If
atomic
package
a
could
the
which
on
make
would
to
profit.
a
price
the
But
worked
be
adequate incentive
without entailing unjustified subsidy of atomic power? Can a system of competition among interested companies be fashioned to
strike the appropriate balance of
these
assure
factors?
There
the
us
is
another
possibility. If
day should
—
come,
matter how
no
might
which all of
doubting we
be—fervently
hope
will
come, when world peace is a reality, when international control of
are
for
weapons
are
succeeds,
international
when
more
the
or at
condi-
tranquil than they
today, would there be
government
a
need
continue
to
buying plutonium?
if the buying of plutonium were
stopped, it is easy to imagine the
,
dislocation
to
civilian
industries
that would have sprung up
sites
reactor
power.
on
to
a
utilize
around
atomic
sudden stop order
plutonium buying, and the re-
sultant
0f
With
sharp increase in the cost
what means could be
power,
devised to avoid
or
minimize dis-
location?
it may be
The
circle,
the
The problem of purchasing plu-
atomic
the
determine
must
We
Or, the result might
in
development
there
needs,^foreseeable
our
be that the number of participants
question that logically follows is: What about plutonium?
If industry is to be able to
This question and its answer tie in
the ball successfully, there
must come
If the mili-
companies concerned.
tion than
est order of vision and statesman¬
of port
which
recommended
where Atomic Energy Commission
attacks ganization.
This report was
pressures
field,
sound
on
in buying plutonium for stockpile
lems,
lide
primary role
confidently
no
this
to
ance—based
whole range of probdemonstrates that
there is more to a thorough soluagainst
up
lies in action by Congress
the nation's needs for the common
changing the law to lift patent and
ownership restrictions seems to defense and security in the broadest sense? This is a question with
me an over-simplification.
Natu¬
many facets.
For example: Will
rally, the effects of the present
restrictions are a part of the pres¬ developing civilian atomic power
divert more fissiqnable material
ent picture.
But exclusive con¬
sideration of them fails to take than prudent from military uses,
that is, from use as bombs and as
into account
issues
inherent
in
submarine and, aircraft fuel? And:
atomic energy itself and in its
answer
of
Indeed,
production,
taking a greater role in power de¬
velopment might depend on the
assurance the AEC can give of a
limited guarantee for
that we should not be actively they should be laid out so that all
exploring for solutions to
the of us—at the Commission, in inproblems involved.
I can assure dustry, in Congress, and on public
you that the Commission is pres¬ forums—will have ample opporently actively examining
these tunity to study them and attempt
problems, trying to bring to bear to fit the answers together. Let
in objective fashion the measure us examine some of these quesof vision necessary to foresee the tions.
The first and foremost question
implications of this development.
Policy Problems in Development
similar studies.
being developed, the separa¬ competition in any area
of
isotopes
by
chemical imaginative and daring
means, and—not to be overlooked are required to get a solution to
—the need for a better under¬ problem of such magnitude.
uses
conventional fuels,
For such co-product
years,
intent he changed to?
question brings us squarely
wastes
and
from
keep it
electricity
with
the present
a large reactor sets
I would like to mention some of up
radio-activity equivalent to
economically and that these representatives of
without hazard to environment, American industry will join with the questions that seem to demand that which would come from mil¬
the concentration of waste fission us in finding the key to unlock deep and farsighted consideration. lions of pounds of radium, and
But first, let me call your at¬ that enough heat is released to
products to reduce the volume the door to the future in this chal¬
that must be handled, the separa¬ lenging field.
We on the Com¬ tention to two short quotations supply a considerable city with
problems:
competing
This
way
Commission unique pattern of cooperation be¬
reasonable means at its tween business and government.
100%.
me
ex-
these problems.
We want—
therefore, it appears that the ap¬ yes, we need—the help and advice
plications of nuclear energy to of industry—for the problems we
power
will be limited to pilot face are the problems industry
faces. They will affect the counplant and prototype operations.
However, this cautious approach try's whole social and economic
Energy
it is much, much use every
Your colleagues command to assist these efforts.
working in this field, as you know, We hope, and have every reason
must worry about parts per mil¬ to believe, that something other
lion, and occasionally even parts than a request from industry for
per billion. The challenge of work¬ a complete subsidy of engineering
ing to such degrees of refinement design and construction will result
is one that must be met every day. ultimately from these and other
purity
closer to
intent,
and international effects of
reactor, and the inevitable
a
"shakedown."
Chemical
world.
fuel might
nuclear
tions
companies,
looking into the possibilities. Yes,
you can feel the increasing inter¬
est in atomic power, and get the
strong hope that it really may be
closer.
The growing interest in¬
cludes the practicality of atomic
power for the opening up of un¬
derdeveloped areas, both in this
country and in other parts of the
project. In other
a
from
development
am
not prepared to
AEC has had four groups of com¬ problem, I
on our military needs.
Does the
panies, including the Dow and give detailed answers. I will state,
development of atomic power colhowever, that the belief that the
purity
44/100ths
from
least,
Monsanto
would
firm
words the per kilowatt hour cost
to
the
consumer
of
electricity
effect
of the reasons for this is that the
in and money in preliminary and de¬
is not that well- sign studies.
It is essential that
hallmark
atomic
than it
the
see
we
undertake such
prohibitive
so
requirements for moblie reactors pressed in 1946, behind the pres- would have to be furnished that
ships and planes has been ent Atomic Energy Act. That, of the government would continue to
available to the industrial course, could be changed. Section need plutonium.
groups for study. The combination 7(b) of the Act envisions this.
It
Such a long-range buying plan
of
scientific
and
management provides for a broad-scale review should also consider the interest
brains exploring the problems has of the social, political, economic, of the taxpayer and fairness to all
point out that the future of peace¬
ordination of civilian uses such as
nuclear power will depend
There are some who urge that
power.
Another factor which has
upon the development of success¬
the problem is really quite simple.
seemed to lessen the emphasis on
ful. breeding cycles.
These will
Their argument is, in effect, that
the power field is our country's
enable
us
to
utilize
relatively
all the United States needs to do
abundant U-238 and thorium for comparatively bountiful supply of is to
change the Atomic Energy
low cost conventional fossil fuels.
the release of nuclear energy, in
Act so that the restrictions on the
But now, even in the six months
addition to the much rarer U-235.
private ownership of reactors and
The chemist will be called upon I have been with the Commission,
the private acquisition of patent
to play a key role in this devel¬ there is a noticeable quickening
rights are lifted. Then, the argu¬
of interest in atomic power. Use¬
opment
ment runs, industry will really go
ful power from nuclear energy
to town.
Radiation Chemistry
seems
to be much closer to us
They tell me too of other tech¬
problems.
Figuratively,
learned doctors crowded my office
before I came out here, outlining
problems which I might lay be¬
fore you, but I am just relating a
few today.
One of these concerns
radiation chemistry. There is much
in this field to be explored before
university and industrial labora¬
tories can begin to appreciate the
potentialities of this phenomenon
in effecting unusual and valuable
reactions. Perhaps radiations can
be used to simplify and lower the
cost of key reactions used in to¬
day's chemical industries; perhaps
they can make possible new reac¬
tions on which you can build new
•
Thus
might be
commercial
no
made
time
nical
fare."
of military
power
that
to power
mediate
xny
Commission
in
date
the
activitj^th£j:easibility of industry under-
weaken
and
Thursday, September 25, 1952
...
that such problems as
these I have been talking about
concerning plutonium will never
have to be solved. We may hit
upon the development of power
at competitive cost from non-plu-
tonium producing reactors, though
n°w it apears that this day is not
Quite at hand. The first step may
be non-plutonium producing power reactors for remote, powerstarved areas. Study of the development of atomic energy from
1942 leads me to feel that the
strides the engineers and scien"Sts are making are so great that
reactors
may
be
"power only" reactors may ^
nearer
than
we
dare
hope
for,
though we are still in the
early phases of research and de-
even
velopment.
Regardless of the type of reactor
that furnishes the power, we will
still need answers to a number of
is to be produal-pur- other questions,
a
proved
by all members of the pose reactors, the role of the govOne of these questions, or probCommittee, by both the "conser¬ ernment in buying the plutonium lems, concerns the location of
standing of the effects of radia¬
Scientists had thought of atomic vative" members of the Commit¬ produced will have much to do plants. Because of the inherently
tion on living cells. The gross bio¬ power as
being economically prac¬ tee and the "liberal" members. with success in turning out power dangerous characteristics of relogical effects are well known. tical 10 or 15 years hence. We sud¬ The first quotation: "From the at a reasonable cost.
Unless the actors and the responsibilities for
However, the chemical reactions denly find that this may not be start of its deliberations, the Com¬ government buys plutonium at public health and safety they imresponsible for these effects are the
situation, for power from mittee has been convinced that prices equivalent to its own pro- pose, this has been one of the
as yet largely unexplained.
atomic
energy
seems
closer
at an absolute government monopoly duction costs, at this stage of de- major problems facing the ComThese problems illustrate the hand.
I am not one to name a of production of fissionable ma¬
velopment the cost of generating mission.
We have spent almost
tion
or¬
ap¬
power
vided by co-product, or
Volume 176
Number 5154
The Commercial and Financial Chronicle
...
(1141)
unbelieveable
time,
money, and
manpower on the location of our
atomic plants. At the present time
we
are
and
plants, in order that national
curity be protected.
Consider the
safety" into reactors and of "con¬
taining" possible accidents, in or¬
der that
th^ Commission's
safety criteria
be
can
less
sometimes
thought to
locating
servation
cause
the
be
in
strin¬
reactor
too
of
experiments.
I
slim reed to lean
upon.
titude must be one
to
It is
easy
power. The
the
individuals
the
the
government.
eral
It relates to the stake of the tax¬
in atomic energy.
availability of atomic
industry.
At
the
present
of in¬
in
suggesting
Another
should
a
question
be
the
coming of
power,
what
are
taxpayers
activities
re¬
sponsibility for health and safety
within
privately-operated atomic
must
contractors
•done
by
plant
What
Of
in
the
atomic
energy
they have sponsored?
amendment
course,
of
I
the
operators
both
responsibilities
the
lethal
activity?
tical
the
must be
that
arise
out
the
as
which
private companies
Atomic
Energy Commission goes
to great effort and
expense to pro¬
tect those who work in the
indus¬
Would
table
to
basis
private
devote
industry
much
as
that
be
attention
problem
of
able to obtain
and
ers
This is
as
people
living nearby,
government op¬
we
considered se¬
and
ment for
These
lems
maximum
the
patent
I
as
see
them
as
member
a
All of
would
at the Commission
us
to
give
solutions
any
private
industry the
possible in this
active stake
most
are
that
At
and
the
time
same
cannot
we
close our eyes to the
far-reaching
significance of the problems which
confront us.
Every one of the
competitively
questions which stand before us
attractive profit. In the same
pat¬
should receive full, careful and
tern, there must be engineering
competition between private com¬ intelligent consideration; and the
interest of the American
taxpayer
panies so that industry will make
also
Like
other
this
one
is
produces
plutonium.
problems
mentioned,
many-sided.
You
can
imagaine many of the considera¬
tions not applying to other indus¬
try that security brings into the
picture; I shall mention a few.
Undoubtedly, reactors for pro¬
ducing atomic power will incor¬
porate
the
nology.
Ihave
world
a
actors
latest
and
Therefore,
will
of
be
best
peace,
prize
tech¬
unless
we
these
targets
re¬
for
espionage and sabotage by un¬
friendly nations. In addition to
protection of the reactor itself,
ithere must be
adequate control of
tthe
fissionable material
Fbecause
weapons.
of
its
The
produced
usefulness
for
government
now
tspends
large sums of money to
f*guard fissionable material and to
protect its atomic plants against
Hhe leaking of secret information
land
against sabotage and destruc¬
tion.
What arrangements could be
'established to assure adequate
pro¬
tection of private atomic
plants in
the interest of the national se¬
curity?
In
the
sense
of
security,
the government takes
special
to
assure
care
continuity of operations
in its atomic plants.
profit,
a
maximun
be
that there
contribution
to
nuclear
development.
It
is
this
competition which will most ef¬
tion that arises is:
in the cooperative
atomic
power
company
How do
at
to
At what stage
does
the
private
insure
the
which
expense,
background for
many
patent developments?
inconceivable
mine the extent to which the
gov¬
ernment should be responsible for
plant
security,
even
in
private
industry
energy
—
should
always
receive first consideration.
a
Glou¬
other
future.
great
bromine
from
are
only
minerals.
great
the
few
a
In
plants
iodine
of
and
but these
sea;
the
available
addition,
quantities
there
are
of
aluminum,
boron, calcium, chlorine,
copper,
fluorine, lithium, potassium, se¬
these
seaports
becoming
centers of these
When I
was a
known
new
business
rosefish
ocean
cut and
By
shipbuilding
try
of
The next indus¬
the granite
industry. Mosfc
was
the Federal
buildings of Bos¬
ton, New York, Philadelphia and
large cities were built o£
Cape Ann granite. The "waste"
other
was
made
into
paving
stones,
which paved the streets of
these
cities.
But concrete and
asphalt
along and killed the granite
came
business.
Although the fishing
always existed in
business
had
way,
yet it
was
oped
until
sraaD
a
the
not
fully devel¬
granite business
to peter out. Later came
"summer
people."
Unfojfrs
tunately, due
(1)
to
the
fisM "J
began
the
changing
(2)
to
their
habits
of
unreasonable
abode,
labor
de¬
mands, and (3) to increasing for¬
eign
importations,
the
fishing
as
the
on
worried
lieve
of
to
as
to
other
of
of
may
I am
I
not
be¬
the establishment
for
the
make
sea
Fisheries
will
con¬
Gloucester
and
prosperous.
seaports
stead
But
future.
School
new
wealth
tinue
conducted,
the
that with
the
the
now
decline.
In¬
filleting plants, Glouces¬
will
have
chemical works,
pharmaceutical factories and wiB.
ter
the
can
isms
small
planktonic organs
heretofore neglected.
A. T. Hammill Joins
W. E. HnHon A (S«t.
was
(now
perch)
was
illustrate
To
away.
great
industries.
wooded.
moved to Essex.
boy, the cod, had¬
mackerel
as
thrown
largely been
be
few
heavily
1800 the timber of
Cape Ann had
business,
Minerals In the Ocean
Today there
are
taking
magnesium,
how
times change, the
catching, fillet¬
ing and freezing of ocean perch is
Gloucester's
now
try.
leading
indus¬
Gloucester, however, is han¬
dicapped by the fish moving out
They may
further from the coast.
later
be
ficial
lighting
attracted
back
the
or
by
arti¬
of
use
fer¬
tilizers.
New
The
will
next
be
sing
pogies,
are
the
of
Kinds of Fish
great
development
catching and proces¬
"waste
squid,
fish,"
skate,
used
now
There
is
another
which
consideration
meet the
obligation to the taxpay¬
of
how
to
The cost of atomic
energy re¬
is so expensive that it is
that
industry could
support the reseach program nec¬
essary to achieve continuing prog¬
ress
the
in the shortest possible
and attaining leader¬
answers
in
this
great
field
new
for
enterprise.
We
the
on
for
such
etc.
fish
as
These
oil
Arthur T. Hamill
and
Commission
are
time.
food,
products
from
rivers
the
soil
into
finally into the sea.
A large portion of fertilizer
being
put on the soils finally goes into
the
ocean,
while the rich
age
of
large cities is making
tribution to solving questions such
as
those
outlined
here
tonight.
the
aware
to make
our
we
pected
that it is
our
greatest possible
duty
cannot, we are not ex¬
stewards over the public
our
sea
a
future foods.
great
should
talk
sewer¬
storehouse
Readers who
terested in these
new
with
are
for
possibilities
Dr.
Henry B.
Bigelow of the Oceanographic In¬
to
stitution
effectuate
whole
people
competent
swers
the
are
answers.
the
authority.
The
ultimate
Upon
an¬
the
Woods
Scripts
Hole,
Institution
Mass.,
at
Warren
with
of
and
breadth
of
useful¬
La
Jolla, Calif.
atomic energy.
All of us
will do well to ponder the issues.
Lessons of
has
become
Merrill Lynch,
connected
Pierce, Fen-
& Beane, First National Bank.
Building. He was formerly witiw
ner
the Denver National Bank.
Joins
(Special
with
History
During the early days of Glou¬
cester, the chief industry was the
Manley, Bennett:
to
The
DETROIT,
Manley, Jr.
made depends much of the
progress
ness
or
at
DENVER, Colo.—Charles L. C.
in¬
enterprise, to arrive at, much less
as
(Special to The Financial Chronicle)
the
and
con¬
keenly
But
factor
requires
er.
chicken
ac¬
know-how, developed
government
must be the
equitable
search
be
—the initial investor in the atomic
development of ship
begin to acquire rights?
we
taking be needed? We must deter¬
can
advantages, I believe
Newburyport and
cester,
small
Massachusetts
Arthur T. Hammill has becorofii
but they have ex¬
There is more to this problem
fectively drive down costs and
cellent nutritional qualities. Later associated with W. E. Hutton 8k
than a change in the basic law
bring technological advance.
we
will be
gathering, processing Co., 14 Wall Street, New York
development of
Yet, we must not forget that controlling the
City, members of the New York:
and canning planktonic
organisms.
atomic energy.
Changes in the
the
atomic
Stock Exchange, as a registered,
energy
This industry has a
industry is social
great future.
order possible as a result
unique in the history of our in¬
Seaweed
products will also be representative. Mr. Hammill wa»
of atomic energy are not made in
dustries. Every step —
formerly manager of the interna¬
research, the
processed and sold.
abstract.
Industry cannot sit
tional bond department for Leo
development, and production —
The sea is very rich, due to the
idly by, hoping that the way will
has been paid for with
Higginson Corporation.
taxpayers' be
paved.
drainage accumulations from the
money; every cent of the cost of
land for millions of
years; but it
the vast capital structure under¬
Certainly, no company should
is now rapidly
Gunnar Voss Opens
increasing in food
lying atomic
energy
has come endanger its solvency; but I am
values. While the farms of the
sure that
from the same source.
industry is not going to
WASHINGTON, D. C.—Gunnar
sit on its hands waiting for an¬ West are gradually getting poorer H. C. Voss has
opened offices im
There can be no doubt of the
swers.
As the opportunities arise, through erosion and cultivation, the
National Press Building to enrstake of the taxpayer in patents
private enterprise will devote tal¬ the sea is constantly becoming gage in the securities business.
developed as the result of costricher. Every rain throughout the
ent
and
money
with
normal
reimbursement-type contracts at American
spirit to the objective of great agricultural West washes
government expense.
The ques¬
With Merrill Lynch
catalyzing the process of reaching minerals, vitamins and other food
What provi¬
adopted to assure
such
continuity in the private
plants?
For example,
would a
special lab or-management under¬
sions
to
of
a
power
cess
broad
be
can
must
way
oppor¬
students, wageworkers and inves¬
tors. Owing to
good harbors and
height, while
ular
a
of
The
offers
great
and
such
in
world
tunities
dock
prob¬
program.
words,
are
Most
then
was
undiscov¬
sea
Roger W. Babson
at its
the
receptive
other
the
—
riches.
of
some
provisions
actor
an
ered
public welfare.
are
property
the power re¬
oceans
develop¬
operators of nuclear power plants
of manufacturers
plants.
of
t h's
e a r
enough of these minerals to last
a
thousand years and I visualize
drawn
when
the
lenium, sulphur and zinc, not to
mention sodium chloride. There
is
even
gold!
The
sea
contains
under
of the Atomic Energy Commission.
for designing and fab¬
the components of the
the
quarters
of work¬
with equal force both to the actual
ricating
to
fact that three
to think about the
you
Then
security
and more attractive avenues
necessary
call atten¬
tion
namely,
questions of
patent rights, profits, competition,
research
essential
for < national
increasing im¬
industry opens up
and to the army
let
forms of operation.
Finally,
saw that
intimately associated
we
capital for
This applies
land
our
with the stake of the
taxpayer in
atomic
energy
are
of
of possible endeavor.
written
to the waste
me
have
vessels.
many
And what
curity for national defense
competition
a
wealth
resources,
seaports
boards, and the building of
pessimistic
articles
are
the
of
other
cutting of timber, the
sawing- o£
sea¬
So
sea.
as
reactors pro¬
electric power and
ways with us, and will be of
partic¬
concern
summer
in
of
being
purpose
of
eration.
energy on a competitive
other investment op¬
becomes
In
security is al¬
this
week
speak
suffi¬
in private versus
with
portance
to these problems?
The
dual
asked
our
portunities.
more
com¬
pensation, for the protection of
themselves and their workers. The
try.
atomic
of
type of in¬
would need, both health and
be
problem of reactor safety and lo¬
profit system, when
private industry carries the ball it
the
be
potentialities of radio¬
There will be such prac¬
problems
surance
and
AEC
to
the
me
special
a
both
Under
discharge
the
will
cation, and of the health
tracted.
operating
should
of
both
plutonium as co-products?
certainly
to
reactors.
let
son,
last
my
solved before
ducing
The
be
power
is
needed to insure that
are
uses?
about
present
restrictions
on
private
problem of protect¬ ownership of reactor facilities and
ing the health of the worker in the establishment of equitable
pat¬
our plants is a
constant concern ent arrangements are inevitlable if
to the Commission
and
private enterprise is to be at¬
plants?
this
Gloucester, for
great
custo¬
developing, building, and operat¬
ing nuclear power plants.
First,
there was the problem of
changes
the rights of private
are
vided for private
industry with
full recognition of the stake of the
What
Government's
our
the
upon which our whole in
law.
Then comes the broad
is built?
question of the compatibility of
Perhaps, next to that concerning civilian
power and national de¬
security, the fundamental question fense. Is there
enough fissionable
is: How are incentives to be
pro¬ material for both
major part
is:
of
As
economy
solution.
a
materials.
As
scource
private in¬
dustry is likely to be able to enter
competitively into the field of
enterprise,
scientists who make
Reactors
Safeguard
Committee, will play
new
toward
energy
must be
the people (the tax¬
original stockholders,
as
and what
findings, along with
AEC's
nuclear
payers)
who have dealt
with problems of
industrial safety
in hazardous industries
for many
up
this
Summary and Conclusion
the rights of
people,
the
consider the
we
civilian
responsibilities.
of
a
In summary, I have endeavored
to state some of the
problems that
biggest customers of this industry.
and also to
determine the methods
of executing these
Their
at
surface-
time
When
those
that
government
these
govern¬
establishing criteria gov¬
erning the locating of privatelynuclear
power
plants,
years.
and points out
the ocean.
the
ciently knowledgeable and capable
to carry out that
responsibility?
publicly-owned
determine
utilizing the advice
in
continued
are
dian, the government has
the
operated
are
fact
chanics
taxpayers, through their De¬
fense
Department, are also the
We
field
developments in the fisheries
industry
increasing utilization of products obtained from
Says fishing business may be
declining, but it wiLI
be replaced
by chemicals and other use of ocean
that
assure
activities
reviews
improving
public ivelfare, and increasing the
standard of
living."
What me¬
big problem, with its sev¬
corollary problems, remains.
ment for
dustrial
the
atomic
Our
money, the American people have
built up a gigantic
to
By ROGER W. BABSON
Mr. Babson
careful
influence
problem is
Wealth'of the Sea
What must
obligation to
of
energy is
one
natural resources.
national
for
progress
responsibility of the
is
as
With almost $10 billion of their
can
ask:
Finally, and of great importance
the
how the loca¬
see
tion of the reactors
the cost and
of
in¬
satisfactory level?
security risks?
Such prob¬
security, so closely related
payer
to
the problem of
the
defense, clearly call responsibility, in the words
of the
spelling out of a Atomic Energy
Act, for "the de¬
partnership between industry and velopment
and
utilization
of
on
can
Our at¬
of
with caution.
handle
determination
good
only say that
extrapolation, when
hundreds and even thousands of
lives may be
involved, seems to us
a
to
of
protect the national se-t
Has government a con¬
research
nuclear
lems of
be¬
will not extrapolate
we
basis
broad
we
con¬
plants
tinuing
access to secret work in
pri¬
industry's atomic plants? We
would not expect the
FBI, for ex¬
ample, to turn over its reports to
private
corporations.
How
are
and we do not
blow up.
We are
to
any
curity?
have
up;
expect
to
vate
external
one
do
we
view
we must
energy,
that
in
relationship
between
security
and
atomic
national
se¬
provi¬
assure
only loyal and reliable employees
gent.
The fact "is that not
has yet blown
What
to
again,
extricable
problem of the
vigorously studying ways curity of 'workers.
of
getting "built-in sions can be made
means
Here,
se¬
33
Chronicle)
Manley, Bennett & Co., Buhl
Building,
York
Financial
Mich. — Milton A..
is
now
associated
members
and
changes.
Detroit
of
the
New
Stock
.
....
Ex.,
_j
o4
The Commercial and Financial Chronicle
(1142)
The Educational Use of Funds
With First Trust Co.
Chronicle)
(Special to The Financial
the staff of
has joined
First Trust Company
the
Mutual Funds
M.
Neb.—Lorraine
LINCOLN,
Douglas
1952
Thursday, September 25,
...
of Lin¬
By ROBERT R. RICH
coln, 10th & O Streets.
Kidder, Peabody Details Radio Techniques
Speaking at the fourth
National
annual
Mutual Funds Conference in New
Investment
*
York, Milton Fox-Martin analyzed
for his audience the experiences
of
Program
Open
SECURITIES
Mr.
Fox
Funds
request
itself
for
used
RESEARCH CORPORATION
V
WO Broadway, New York 5, N.
ship of
and
tell
to
ers
ful
hfllll"*
■■a*
ialaa
■■■a
in
his
manner.
a
story to
Even
during
a
commercial, he pointed
out, it is possible to pack "quite a
punch" in a well-worded message
by
nouncer.
The
reception
predetermined
be
can
professional
a
the
and
an¬
be
can
message
Further,
said, provided
all, he
he
the
can
listen to only one radio station at
prospectus from
investment dealer
or
PHILADELPHIA
2,
PA.
of various clubs
in
the
small local
this
for
the
and
New
station
public-service
of
purpose
the
to build favorable
was
with
women's
groups,
charitable organizations
forerunner
to
subsequent
civic and
as
a
meetings
with
cussion of
The
them for the dis¬
mutual
low number of
a
fund
investing.
broadcasts, he said, produced
inquiries and
lower volume of sales.
even
controlled, he added.
listener is tuned in at
sponsor¬
an
From
the standpoint of public relations,
however, he said the effort
worthwhile
was
though the sales
unimpressive.
father
The
relations
one-
minute
delivered
A
radio series
■■■a
«■■«
>■■■■
work
used
program
listen¬
experi¬
the
was
series of programs fea¬
a
area.
was
personal and force¬
very
firm's
the
organizations
York
tunity it affords the mutual funds
dealer
of
radio
turing the
principal advan¬
was
the oppor¬
said,
he
in
ments
to
reasons
prospecting.
One of radio's
tages,
Another
recommends
—
number of
a
satisfactory.
were
Co., said that radio—
mutual funds
SECURITIES A
your
said,
produced 500 or
leads in the early part of the
inquiries were largely of a curios-,
ity nature and fairly low in qual¬
ity.
On the whole, the results
the
is
Central Mutual
of
Kidder,
the
intelligently
SERIES
NATIONAL
week
a
he
commercials
more
Department
Peabody &
Details and
who
Martin,
-
of
manager
Prospectus
broadcast
one
mutual funds,
Kidder, Peabody & Company in series, with succeeding broadcasts
field of radio advertising as pulling less.
However, he said,
method for selling mutual fund they found a l&rge number of the
Account
•pon
the
shares.
Investment
the
the
a
An
On
featuring
of
the
President
of
is
and
his
the
dividend
have
funds
mutual
an
market, and, of
extremely
ably unsuccessful.
On one-minute
commercials, he noted,
he
course,
were
number
a
in
counts
his
a
has
radio set in his home
a
or
financial experience,
own
the
standpoint of cost,
radio advertising falls into a low-
stations
generally enjoy a
high-income audience.
The key
to the
Bank Group Shares
Shares
Insurance Group
Stock and Bond Group
Shares
high
Funds)
ables him to tailor his radio
cov¬
effectively to his advertis¬
Ltd.
The audience
Factors
the
the
was
19
RECTOR
NEW
YORK
STREET
6,
N.
Y.
Prospectus may be obtained from
warned, how¬
Martin
First,
radio
has
considerable
wastage in its coverage because it
is
a
mass
medium—wastage in
was
comparison, for example to direct
mail advertising.
and
Second,
radio commercial has
a
life beyond its air time, and if
no
a
person
doesn't
tuned in to the
time of the
happen
to
be
right station at the
commercial, he
never
Third,
peculiarity of radio, as
compared to publication advertis¬
a
a
best
possible
vehicle
a
for
ready
thought
he will be
of
use
generating
during
fathers
some¬
had
series
were
carried
an
since
the
fund
dealer,
he
noted,
extremely
disappointing
experience in the use of the series
he selected as his broad¬
because
time Sunday
cast
Monday
on
Fund, has
plans for his own
ever
midwest
One
had
the
in
broadcasts
three
the
of
one
started.
period of the preceding year.
As an experiment, he said, the
final
likely,
surprised to learn that
just such
children
corresponding
the
originality
trustees of The Putman
plaining economies and finance to
younger minds.
tising
thought
course,
some
Putman,
George
ing diagrams on a sheet of paper.
But these approaches lacked real¬
besides,
of
claim
for this unique idea. Quite
using
of
like "Monopoly," or draw¬
games,
father,
could
he
risk for a gain.
father
The
are
adults today.
The
noon
instead of
morning or later in
the afternoon.
Another office, he
earlier in the
evening directly following a news
commentator.
Because
of tele¬
and
said
a
selected,
strong local station
that had broad
one
which,
listening
portance
of
selection
of
its
and
mature
a
program
because
were
that
they found
vironment
important
the
en¬
of
advertising has a
great deal to do with its reception.
Next, they worked for quite a
on the selection of time, fi¬
while
nally deciding
ing
15-minute pe¬
morning follow¬
on a
Sunday
on
world news-roundup.
a
"In
Fox
Mr.
-
Martin
baseball
com¬
extreme care in
broadcast time.
Recordings
made
lent
the
to
other
Kidder, Peabody & Company of¬
fices and cooperating dealers for
experiences
results.
of
Radio Advertising Suggestions
of
trying
their ef¬
thinking
those
•To
radio for the first time in
forts
to
uncover
sales
leads
others
(1)
proved particularly revealing, he
A radio commercial should
in
its language,
unfinancial
be
said.
following a world news broad¬
ing, is that the appeal for write-in cast," he said, "it was reasonable
inquiries must rest solely upon the to expect that quite a number of
appeal
time
of
the
commercial
at
the the
the persuasiveness of the
announcer and the immediate re¬
.
.
.
action of the listener.
news
broadcast listeners would
stay tuned
cussion
of
morning
in to
serious dis¬
our
investments."
was
selected
Fundamental Investors, Inc.
Sunday
because
it
represented a time when a greater
Radio
First
Mr.
Venture
Fox-Martin
said
number of
that
firm's initial radio venture
his
was
a
be expected to be in their homes.
Sunday is also generally
20-week sponsorship in 1950 of an
11
o'clock
news
program
on
a
of
strong
New
entire
15
sponsored
York
minute
on
of
■M •
no
obligation please send
vision
program
was
prospectus on
Canadian Fund, Inc.
out
of
C»T
period
and,
less tele¬
a
reflection
there
mornings.
competition
is
on
three of the
Cost Cut
Diversified Common Stock Fund
66%
The results from this 15 minute
of
16
weekly
broadcasts
were
extraordinary, although Mr.
program
commercials were
de¬ Fox-Martin
only termed them
voted to general brokerage busi¬ "quite satisfactory." As compared
ness, with the third devoted to to Sunday newspaper advertising,
Mr.
Fox-Martin
estimated,
on
the brokerage side of the program,
that the broadcast series was paid
for in
commissions.
Diversified Investment Fund
Sunday
A
Inquiry
series
every
mutual funds.
kiUress.
and
Wednes¬
commercial time.
Two
furthermore,
The
days and Fridays with approxi¬
mately two and one-half minutes
SfNTLEMEN: At
relaxation
station.
Mondays,
Manhattan Bond Fund, Inc.
working people might
the radio effort of Kidder, Pea¬
body & Company produced three
times as many leads per dollar ex¬
penditure, and twice
lar sales
as
as many
dol¬
did newspaper adver-
PROSPECTUSES
AVAILABLE
FROM
YOUR
ON
LOCAL
THESE
MUTUAL
INVESTMENT
FUNDS
DEALER,
OR
Cleveland
Chicago
Los Angeles
for
funds,
Mr.
Fox-Martin
made the following suggestions:
mutual
rebroadcast in other cities.
The
jockey
disk
of the series produced
Work,"
at
available
and
The Chicago rebroad¬
excel¬
cast
successful
this
Money
"Your
series,
were
of
games
programs.
mented, clearly illustrates the im¬
audience. The calibre of the station
coverage
riod
gets the message at all.
take
to those who
of
Working closely with Doremus vision competition and other fac¬ said, made an error in the selec¬
Company's Barry McMennamin tors, the response from the Monday tion of a station, with the program
Edward
Rooney, Mr. Fox- evening series fell off nearly 50% sandwiched between broadcasts of
&
the above or local dealer.
the
as
which must be taken into account.
by
LTD.
funds, Mr.
Fox-Martin said that they set out
that there were certain dis¬
advantages to radio advertising
Distributed
of
heads
management
certain leading mutual
make
to
ity—and
In developing the very success¬
ful "Your Money at Work" broad¬
cast series of 15 minute interviews
with
holds out
they will know more about
handling to best advantage
their financial problems than
most
times become a little confused ex¬
mutual funds business.
ever,
HARE'S
15
as
many
The Key to Success
radio
'i
Adverse
Shares,
year-round usage plus
frequency—as
„
week.
per
to
ing budget.
Of
Institutional
more
ties,
the
approach"
com¬
.
....
erage
Investment
(Mutual
mercials is
Furthermore,^he remarked,
ranging all the way from the
sponsorship of programs to a 15second station break. This variety
of packages which can be bought
by the mutual funds dealer en¬
of one-minute
success
cost
bracket, he told his audience.
there
are a wide variety of commercial
packages that may be purchased
programing.
musical
good
Such
From
"thrift
investment
car
both.
or
Aviation Group Shares
also
are
keenly
hardly gave a
dealers have had
said, radio is a mass, cross-section
complete picture about the dy¬
medium. Nearly everyone that is considerable success using either namic
qualities of the American
FM or local AM stations that fea¬
a mutual funds prospect, he noted,
economy and the possibilities it
ture
of
.i
questions to answer.
children
The
have
interested
in
company
a
time.
There is no competition
sponsored by one of the leading names, now; checking the name
Mr. Fox-Martin said that they
at a given moment as there would
of a railroad, for example, against
banks in the community, and the
have
used
radio
and
television
be
the portfolio holdings of the Putamong
different
advertise¬
daughter will soon have her first
for spot announcements, but have
ments on,the printed page.
man
Fund.
By the time these
checking account.
Mr. Fcfx-Martin also noted that found them inadequate and not¬
children are in their early twen¬
But, as the father knew from
broad
.
more
were
growing up in.
savings ac¬
school bank tnat is
children
Both
questions. When the first
checks
arrived,
there
the
ask
certificates of
their
and
ownership. Then he let them
share
the world they are
even
open
various kinds of
prospectus,
booklets
daughter, Mary Elizabeth,
complexities of
to
was
Putman Fund.
he gave them
George
comment
Without
financial
the
to
the
with
America's
of
one
publishing
houses,
had
quite a problem on his hands
when he tried to find a way to
educate his son, Stanley Brown,
largest
solution
account in the children's names
an
Vice-
a
final
His
children
two
above,- who
pictured
HUGH W. LONG AND COMPANY
Incorporated
San Francisco
Westminster
at
Parker, Elizabeth
3,
New Jersey
Volume 176
Number 5154
...
The Commercial and Financial Chronicle
(1143)
Ttvo Booths At Fund
ing price will also be calculated
Conference
3:30
at
effective
p.m.,
from
that shifts in the
country's popula¬
OPEN-END REPORTS
tion
through migrations to the
MASSACHUSETTS Investors
west, south and southwest will
Growth Stock Fund reports for
create increasing demand for new
the three months ended
Aug. 31,
homes in the areas affected
by 1952 increases in the number of
such
4:30
to 2 p.m. of the next business
p.m.
day.
Redemption
prices
will
be
calculated for similar purposes at
1 p.m. and 3:30
p.m.
ARNOLD
BERNHARD
&
movements.
Investment
Survey,
sponsorship of a
fund
to
Line
known
the
as
Value
equal
voting rights and
preferences
as
to
conversion
that
ex¬
dividends, retirement or
other feature, effective as of
Sept. 12, 1952.
Line
Income
ratio
"And
at
Fund
if
national
present
centage
year old Value Line
increase each
Fund,
capi¬
a
as
of
its
primary objective, cur¬
rent
.jncome as high and as dev.£enda$ie as possible in keeping
Twljt^^kihnd investment principles
investment
of
Ryan
growth mutual fund, and will
have
assume
58%
levels,
home
on
con¬
that
the
estimated
an
Not all of these
want
investment
or
pointed
of the Value Line Income
I^nH^jll
be Arnold Bernhard &
there
Co.,
Officers
made
Directors
and
Bernhard, President
and
Director; Gavin H. Watson,
Vice
President, Treasurer, Asst,
keep the
Secretary and Director; Frank H.
Miesse, Secretary and Director,
and
James
E.
Barrett, Jerome
Preston
rectors.
ern
that
three
months
1952
Line
Fund
Distributors,
•York.;';•.
;
The 'selling
commission
included
j
sponsor
mutual
funds
representatives
dealers
and
salesmen
talked
8.5%
to
before
J-1.5%.
Dividends
vested
net
at
be
can
industry,
well
soundly financed and
with
a
strong
growth trend," the September is¬
p&rticularly if
or
standard program
a
spot commercial is used.
most complex ideas should
pressed
in
short
words
be
and
(2)
The
should
be
listeners
about mutual
sen¬
PUTNAM
should
FUND
this
mind.
in
be
know
funds.
Make
impression;
anxious
conceived
and
for
a
with
good
first
be
over¬
don't
immediate
build
confidence
and
results.
reputation,
he said.
Street, Boston
Fox-Martin
at
the
conclu¬
sion of his analysis of radio
ad¬
vertising noted that because deal¬
have
ers
cational
would
all
such
job
-
tors
of
clared
and
income,
1952,
cents
payable
to
Inc., de¬
per
share de¬
September
shareholders
of
29,
record
At the
same
declared
a
Mutual Fund Notes
Eaton & Howard have
announced
time change in the determina¬
a
tion of public
offering and
demption prices. The change
by the extension of trading
on
•
September 29,1952, to shareholders
'
September 16.
Lord,
ported
of
York
Stock
Business
MUTUAL, INC.
Minneapolis, Minnesota
&
the
Fund
Shares
at
1
Company
net
asset
and
American
will
be
instead
o.m.
re¬
value
deter¬
of
noon.
reports
simi¬
&
K. Bradford, President
//WCtifV/S
p.m. to 3:30 p.m.,
Abbett
that
Affiliated
mined
H.
New
effective Sept. 29.
of
past fiscal year, also payable
of record
the
L'xchange from 3
special
from security profits realized during
the
re¬
was
caused
meeting, the Directors
dividend
the
for
and
Power
Ni¬
Corpor¬
Company
and
Corporation.
Eaton
&
Howard
larly that the public offering price
of
Eaton
Fund
and
&
determined
from
p.m.
2
at
p.m.
of the
Howard
Stock
1
of
same
Balanced
Fund
p.m.,
that
day.
day
will
be
effective
to
4:30
The offer¬
postwar period,
dustry
contacts
the
recent
excess
the
hands
of
been
surance
here
of
the
for
basic
paper
in
most used
been
distribution
vestment
in¬
and
mutual
V
*•
,
Mergers
underwriters.
costs
the culprits back of the
trend, Mr. Davis explained.
are
merger
They are responsible for the un¬
derwriting deficits. Larger units
will help to spread overhead and
Ihus reduce expenses to
There
ings
will
in
less
in
banks
the
fixed overhead bulks
gers
which
trend toward insurance
mergers of
which nearly a dozen
significant
may
field.
on
spread to the
of
in
occurred
First and
profits through
level
Stockholders
have
the
many
inde¬
pendent banks
the country
where
substantially
Mr.
Davis, in concluding his
talk, ventured the statement that
two developments could slow
the
extinguished
Shelby Cullom Davis
sav¬
how¬
larger.
restoration
mer¬
degree.
mergers,
is
of
a
overhead
insurance
than
ever,
be
years.
to insurance
the
face-amount
of
ones
only
among
leaders
certificates
several
product in
in
the
ted that the
in
di¬
in
stocks, predic¬
wave
today—second
has
national
de¬
study stresses the gain in
capita paper and board con¬
sumption from 244 lbs. in 1939 t/
390 lbs. in 1951. It describes paper
the third
S.
from
The
as
office
D.
insurance
per
America
Ex¬
specialists
out."
on
to
Eugene
There, under his leadership,
a
strong
products
York
change, and
in
look for
we
the New
Stock
in¬
have
users
I.
in
says
members of
that
inventories
paper
liquidated and
renewal
our
the
the
trend in banking will spread to in¬
companies, owing to dearth of profits of small and
"Perspec¬
on
believe
we
1946.
with
Corps dur¬
advanced
was
manager
fund shares.
paper,
tive" continued: "Based
of
the
past
foremost
reasonable
adequate
an
rate
particularly in casualty lines.
And
second would be a decision
the part of top insurance man¬
agement to pay out a higher pro¬
of investment income in
portion
milk and water.
small and medium-sized insurance
dividends.
companies,
tive
AN AVERAGE OF at least 840,000
restive
homes
Mr.
Davis
because
of
stated,
the
dearth
are
of
One
insurance
execu¬
has publicly predicted that
insurance company dividends will
will be constructed underwriting profits, particularly again approach 75% of
investment
States during the in
casualty companies. Shares of income once underwriting again
next five years, it was estimated their
companies, he pointed out, becomes profitable.
Should this
by Donald E. Ryan, Vice-President are selling in the open market at occur, shares of insurance com¬
in charge of the mortgage depart¬ discounts of 40-50% below the net
panies will rise in price and stock¬
ment
of
Investors
Diversified asset or liquidating value of their holders will be
less tempted to
Services, Inc., one of the nation's investment portfolios alone.
No sell
to
the
merger - promoting
largest
residential
construction value whatsoever is assigned for groups.
the
in
LORD, ABBETT & Company and
twenty-two cents per share derived
r„
to
hours
September 16.
,
purpose of
advertising
medium for collective invest¬
1952, the DirecMutual,
rived from net interest and dividend
.
primary
ing.
regular dividend of fifteen
o
little
so
Quarterly Dividend
Investors
one-half
and
public's opinion of—
for—this relatively
respect
new
Notice of 48th
Consecutive
do
funds
enlarge the
MUTUAL, Inc.
to
be the
mutual
and
tremendous edu¬
a
to work with, he hoped it
money
On September 15,
in
mand
Mr.
*
outlook
Company
sixth
You are dealing with other
peo¬
ple's money and it takes time to
Putnam Fund Distributors, Inc.
50 State
don't
He
Empire visional
the country's
medium size
But,
largest industry.
they all have certain financial
In an address, entitled "Finance
"The
postwar
years
through
problems.
"Pose
the
at
problem," 1951," the publication states, "have Looks
Insurance,"
before
a
Mr. Fox-Martin
said, "explain that witnessed a more or less continu¬ luncheon meeting of the Insurance
funds can help solve
them, offer ous upward trend in paper pro¬ Accountants Association in New
something which explains funds, duction and
York City on
consumption.
The
and offer your services."
1951
production of 26.1 million
September 18,
(3) At the persent time, the ad¬ tons
compares with 8.0 million in
Shelby Cullom
vertising of mutual funds is as 1932, 12.8 million in 1937 and 19.3
Davis, ot £>neimuch educational as
commercial.. million in 1946."
by
Cullom
An
advertising
program
and
Davis
&
Co.,
Noting the two minor setbacks
budget
■Oeoyqe
of <t7jo4ton
remembered
most
much
ex¬
tences.
d/e
It
that
ing World War II in the Pacific
Shelby Cullom Davis
of
"Perspective," published by
Calvin Bullock, sees a favorable
sue
31,
Foresees Wave of Insurance
managed
in
Aug.
Mohawk
Studebaker
CHARACTERIZING the paper in¬
dustry as "a vital consumer goods
S.
serving
5,000
Southern
D.
as a zone represen¬
Marine
Diamond theater.
a
year
United
and mortgage lending
institutions.
plant or goodwill built up
Many stockholders at present
have
laboriously over many years.
also
been
shareholders of
homes during the past three years
According to Mr. Davis, these merged banks, for investors in in¬
has made a substantial dent in the stockholders are quietly being im¬ surance stocks are
frequently also
lecord postwar demand for new portuned to "throw in the sponge" investors
in
banks.
They have
housing," Ryan pointed out, "but by interests seeking to capitalize found the pain of extinguishment
"The
several
building of 4,000,000
factors
will
agency
new
continue
to
operate to keep demand at fairly
on
the
uation.
either
current
unsatisfactory sit¬ surprisingly sweet for they have
The companies then would
be
obtained
as
much
50%
as
more
liquidated. than the market for their shares.
Although old stockholders would They have been free to enjoy
He emphasized that even if the prefer to remain loyal, he added, "another look" and decide whether
total
number
of
marriages de¬ the temptation of higher prices to reinvest their savings in the
clines, a substantially higher per¬ and a "way out" of their dilemma same
high and stable levels for the next
merged
or
five years."
industry
centage
of
married
become home
case
owners
eight to 12
couples
than
years ago
was
will
the
and be¬
may prove
case
be
a
too great just
of the banks.
as
in the
The result will
fore, because of increased
to
or
to seek greener
Probably not
and
steadily
rising
surance
shareholders
come
smaller number of insurance
ability companies.
Inflation
buy homes. He also pointed out
pastures.
similar
Davis
a
concluded.
'
"Oregon-
I.
tative .after
Eliminations included
ation,
Portland
joined
United States
agara
rein¬
the
the
com¬
pany.
asset value.
for
Boscow
Portland, Ore.,
Com¬
2,000 Kansas Gas & Electric Com¬
2.25%, with
ranging from
the dealers' discount
with
booths like the above
during the
fourth annual Mutual Fund
Conference held at New York's Hotel
Statler, Sept. 15-17. Calvin Bullock
reported a keen dealer in¬
terest in its new Canadian
Fund. Its representatives also
helped
iron out dealers' problems in
sales presentation and the
more ef¬
fective use of Bullock's wide
range of sales information. The
other
booth belongs to Wellington Fund.
.-o
,
from
range
700
visor
.
circulation super¬
as
during
2,500
Electric
"
Employed
ian,"
ending
Company,
District
will
.
Over
Alkali
New
manager.
building and
principal
was
today by Grady Clark,
Vice-President and general sales
avail¬
Securities
PROGRESS
announced
that
active.
purchases
-
The underwriter and distributor
'of the new/income fund is Value
30, 1951.
Investors Diversified Services
he
rent, will tend to
market
stock
dis¬
share
per
manager
1,000,000
homes
home
new
fact
about
or
reports
pany
mon
**-
1(,
only
NATION-WIDE
John D. Walker, Di¬
and
cents
formerly divisional office,
in Eugene, Ore., to east¬
regional sales manager for
cow,
850,000
homes,
the
year-round
buying
90
reflects
gains
PROMOTION OF William B. Bos-
will
families will
new
But
able for sale
Arnold
are
are
however,
capital
a
of
Nov.
of
as
compared
Aug. 31, 1952. The
PERSONAL
bulk
next five years.
new
buy
out.
vacant
Inc.
of
tribution
per¬
on
share
per
$18.65
figure,
payment
should
homes
new
during each of the
outlook.
and
was
with $17.88
latter
*
'/O^^^anager
date
year."
for
from
Aug. 31, 1951.
that
families which will be formed
new
shares outstanding
total net assets of
$31,649,377
Net asset value
and
remains
the
had 11,504 stockhold¬
1,697,040
and
home
owners
estimated
demand
come
income
high
will supplement the nearly threetal
of
to
newly forming families during the
next
five
years,"
he
declared.
change,
Value
this
reasonable
owners to 42%
renters will
tinue among present families
any
The
seems
15,124, in shares
2,173,764 and in
to
$38,872,487.
These
figures
represent
new
high points in the record of the
ers,
"It
no
to
outstanding
total net assets to
dwelling Fund which
units.
Fund, Inc., with an
authorized capitalization of 5,000,000 shares of $1 par value stock
with
con¬
46,000,000 households, Ryan
pointed out, while 42% of the na¬
tion's
households rent
mutual
Income
be
now
stitute about 58% of the
country's
announces
new
stockholders
Home-owning families
Co.,
Inc., publishers of the Value Line
their
35
a
few in¬
would
opportunity,
wel¬
Mr.
36
The Commercial and Financial
(1144)
Continued
from
page
already taking place in rapid as the international situation
1952, as shown by warrants.
Some of the factors just stated
the negative figures in the table.
as
affecting residential construc¬
was
Housing Outlook
construction
broken
down, in the table, into residen¬
tial
non-farm
influenced
tion
is
It
$58.5 billion in 1951.
struction
"other"
the
"other"
con¬
also.
This
category
construction,
well
as
as
Most
Net Foreign
third
The
"other."
Investment
major component of
gross national product is net for¬
eign investment. A positive figure
represents an excess of goods and
services which are sold to for¬
-of the "other" represents commer¬
fort; and (5) the abandonment of
up
of the
have
new
the
reached
point
where willingness to import, but it is
investment is thought likely probable that this tendency will
Regulation X. On balance, and for
the short run, the outlook is for a to be unprofitable.
continued high level of residen¬
The Inventory Outlook
tial housing construction.
How¬
ever, this factor will bear close
With respect to business inven¬
watching during 1953. It may be tories, I think that there will be
mentioned, in passing, that in continued liquidation, and that
view of the strong inflationary
this liquidation will have for the
pressures still existing, it would be
year a slightly unfavorable effect
if
better
residential
construction
and some other industries
the
civilian
dergo
some
reduction
could
resources
the production
of the
so
that
un¬
more
be transferred
to
gross
national product.
defense
Mutual
Security program. These
grants will probably increase dur¬
be
offset
by increased loans ing the next year.
Government
abroad, which will serve to in¬ sales of goods, minor in amount,
investment. will
probably remain about the
at $0.5 billion. State and local
expenditures may also increase as
date serve to fill the gap left by
these governments pursue their
the
reduction of gross national
capital expansion programs. Again,
in view of the inflationary pres¬
product in other sectors.
net
crease
Such
foreign
loans
In
my
may
at
projections
have
I
same
future
some
sures
as¬
which still exist, I think
My projections assume probable sumed that net foreign investment would be desirable if
levels
1952
of
at
new
$23.6
construction
billion
as
for
will
approximate $1 billion in the planned
against current
the
and
$23.3 billion in 1951; of $26.0 bil¬ which would
of defense goods. lion of producers' durable equip¬ vestment
I do not believe that
pace
could
economy
on
serving
fourth
give
a
quarters,
foreign in¬
figure for the
year
capital
it
of the
many
expenditures
of
States and municipalities could be
Two
postponed.
of from
when
now
or
three
national
years
defense
the present
ment in 1952
that Federal
na¬
We have
arrived at projec¬
now
tions of $216.5 billion for personal
consumption expenditures for
1952, $49.3 billion of gross private
domestic
in
decrease of $0.3 bil¬
of
net
■
time to time affect the forecasts,
We have pointed out that the 1
figures for gross national product
its components are affected
by both changes in physical quan¬
tities and by the prices at which
and
these
1951; and
a
business investment
1951.
in plant and
physical
valued.
much
very
quantities
So far
are
have not said
we
about
the
probable
trend of prices over the next year.
An increase of about
$18 billion
in gross national product for 1952
as
compared with 1951 would rep¬
an
increase of 5.5%.
It
resent
to
seems
able
to
that
me
count
should
we
be
increase
an
on
of
about
3% in gross national prod¬
uct in physical units because of a
larger
labor force and increased
labor
ing
productivity.
2.5
The
percentage
will
crease
be
remain¬
points
of
in¬
for
accounted
by
higher prices.
Wholesale
prices reached their
high of 115.9 (19471949 equals=100)
in May, 1951.
By June of this year they had de¬
post-Korea
clined
This
uninterruptedly
represents
111.3,
to
decline of just
a
4.0%, certainly not
pressive decline for
im¬
a
very
a
13-month
reaction to the over-buying which
Korea.
It is true that
followed
this
average
greater
somewhat
masks
in
declines
percentage
certain commodities such
as
farm
products, and leather, rubber and
textile products.
Commodity Price Outlook
against $24.9 billion $1.2 billion against $0.2 billion in expenditures begin to decline and
effort is
as
me
investment, $1.2 billion
foreign investment, and
$80.2 billion of government pur¬
chases. Totalling these components *
we have an estimate of
$347.2 of
gross national product for 1952, as
"completed."
However, there is
compared with $329.2 billion in
unlikely to be any sharp decrease
1951; an increase of $18 billion.
in defense expenditures.
It will
These
estimates
are,
of course; :
probably cost the country about
only tentative, and are subject to
$40.0 billion just to maintain the
change as subsequent events from
defense
system which is being
When net foreign investment is
with population and the ability
population to produce and mentioned,
all
economists are
cent years has rapidly been catch¬ purchase
is
questionable.. The tempted to take the opportunity
ing up with the demand for hous¬ profit expectations of business¬ of pointing out the obligation of
ing; (2) some scarcities of con¬ men and their consequent deci¬ the United States to assist other
struction materials;
(3) a lower sions to invest remain high, as nations to balance their interna¬
rate of family formation due to indicated by the most recent sur¬ tional payments by accepting the
built up even if no further expan¬
the low birth rate in the early veys
of
investment
intentions goods which foreign nations wish sion is undertaken. In addition, it
made by the Department of Com¬ to sell to us.
Unless we make it is
^30s; (4) an extremely rapid rise
unlikely that there will be a
in construction / costs in the last merce and the Securities and Ex¬ possible
for foreign nations to complete cessation of expansion.
two or three months; and (5) a change Commission. It is true that ship us goods, we shall have to
The rate of obsolescence in de¬
relaxation of rent controls in some corporate profits have been de¬ go on indefinitely extending aid
fense goods is high, and research
areas which is likely to reduce the
clining until recently and that this abroad in the form of gifts, a sit¬ is
continually making possible and
wasteful use of housing and in¬ decreases the amount of cash for uation
undesirable
from
the
necessary expenditures for more
crease
the supply of housing on investment which firms can gen¬ standpoint of
both the grantor complex and more costly defense
erate internally. But business has and the grantee.
the market.
It is true that materials. This is not to say that
an
increased willingness an increased willingness to im¬ the decrease
On the favorable side, however, shown
in, or the slowing up
we
may cite:
(1) the increased lately to go to the capital markets port would lower the contribution of, the rate of increase in defense
for funds, particularly (and for¬ of net foreign investment to the
levels of personal
incomes; (2)
expenditures will not present a
to
the
markets for gross national product, or even problem.
continued
low
costs of housing tunately)
However, the problem
Again, the high change it to a negative figure, but can be overmagnified, and there
funds under government lending equity capital.
levels of consumer incomes, re¬ it
would
enable
American
re¬ are in
and insurance
programs;
(3) a
my opinion ways of attack¬
partially
from
defense sources to be used for the pro¬ ing,
greater availability of materials sulting
and
solving, the problem
be making duction of other things which when it arrives.
than was anticipated because of production, seem to
the slower pace of defense pro¬ businessmen optimistic as to the cannot be imported.
The
other subdivision of na¬
In the future the figure of net tional
duction; (4) a demand for housing prospective rate of return from
security under Federal ex¬
investment.
Capital costs, foreign investment may and
necessitated by shifts in popula¬ new
penditures represents principally
tion resulting from the defense ef¬ though rising, do not yet seem to should be reduced by America's grants to foreign nations under the
(1) the fact that the high
rate of housing construction in re¬
tors are:
to
seems
expenditures for
tional security expenditures are
national defense. These expendi¬
likely in this third quarter to rise
tures have increased from an an¬
about $5 billion from the second
nual rate of $24.3 billion in early
quarter, and to rise an additional
1951 to $47 billion in the second
$2V2-$3 billion in the fourth quar¬
quarter of 1952. The Government ter.
Approximate
stability
in
plans to expand national security other Federal
expenditures would
expenditures to a figure of about give us about
$80.2 billion of gov¬
$60.0 billion. This is only an esti¬ ernment
purchases in 1952,
as
mate of the highest rate to be
compared with
$62.6 billion in
reached under present plans. It is
1951.
eral Government
producers' durable equipment,
represents business investment in eigners over goods and services
Business bought from foreigners. The dif¬
cial, industrial and institutional, plant and equipment.
farm, and public utility construc¬ investment in fixed form has been ference generally takes the form
tion.
The outlook for residential at
high
levels throughout the of promises to pay. Net foreign difficult to say when this $60.0
construction is mildly favorable, postwar period.
Certainly much investment fluctuates widely, but billion rate will be reached, but a
although I am less sanguine about of the need for new industrial in total is relatively unimportant. rise in the rate will probably oc¬
this forecast than I am for some capacity, a need generated by the It should be noted that govern¬
cur in each of the next four quar¬
of
the
others.
The
volume
of very low level of such investment ment loans and grants to foreign
ters, which is the period with
housing starts has been holding up during the Great Depression and nations, such as aid extended which we are primarily concerned.
well and the total for 1952 will by the high rate of depreciation under the Mutual Security Act,
Many
people
are
concerned,
probably be about the same as for on existing plant during the war, are not included in this item, but quite properly, with what is going
has been made up.
1951.
Whether in¬ rather appear under government to
happen to the economy when
The principal unfavorable fac¬ dustrial capacity has now caught purchases of goods and services.
the
defense
build-up has been
and
Thursday, September 25, 1952
National Defense Expenditure
equipment falls off, deferred con¬
in
business
inventories in
struction projects of local govern¬
1952, compared with an increase
The component of gross national
ments
could
be
activated
and
of $10.3 billion in the previous
product which has been undergo¬ would
go far toward maintaining
year.
This would give a total ing the most rapid rise is govern¬
gross
national product at high
gross private domestic investment ment purchases of goods and serv¬
levels.
of $49.3 billion as compared with
ices, particularly, of course, Fed¬
the first half of
New
...
lion
9
The Business Outlook
farm)
Chronicle
There
are
a
number of factors
which
Gross National Product and
give rise to the belief that
the decline in general commodity
prices has about run its course.
Disposition of Personal Income
(Seasonally Adjusted at Annual Rates, in Billions of Dollars)
The
1951—
Clross National Product
or
Expenditure
TotaI
dross national
product
$329.2
Personal consumption expenditures—
208.0
Durable goods
27.1
Nondurable goods
113.5
1st
Qtr.
2nd Qtr.
$319.6
$329.3
210.5
204.5
31.3
26.3
*
4th Qtr.
1st Qtr.
2nd Qtr.
*3rd Qtr.
*4th Qtr.
$330.9
$337.1
$339.4
$343.2
$350.5
$355.5
$347.2
206.4
210.5
213.2
214.9
217.5
220.5
216.5
25.5
25.3
25.2
26.4
28.0
29.5
27.3
3rd Qtr.
Total
Gross private domestic investment™
New construction
Residential
nonfarm
Other
113.3
111.3
113.2
116.2
118.0
117.8
118.5
119.5
65.9
66.9
67.6
69.0
70.0
70.8
71.0
71.5
70.7
58.5
59.8
65.2
56.2
52.9
50.0
49.3
49.0
49.0
49.3
23.3
24.7
23.5
22.4
22.4
23.7
23.6
23.5
23.5
23.6
11.0
12.8
10.9
9.9
10.3
11.0
11.0
11.0
11.0
11.0
118.5
12.3
11.9
12.6
12.5
12.1
12.7
12.6
12.5
12.6
Producers' durable equipment
24.9
24.8
25.4
24.9
24.7
25.7
25.7
26.0
26.5
26.0
Change in business investment total
10.3
10.3
16.3
8.9
5.8
0.6
0.1
—0.5
—1.0
—0.3
9.4
9.0
15.2
8.2
5.2
—0.1
—0.8
—1.0
—1.5
—0.9
Nonfarm
Net
foreign
only
investment
national
security.
Other
Less: Government sales.
State
and
of
1952
same
The
principal factors in the cur¬
divided into
affecting the demand for
goods and those affecting the sup¬
rent situation may be
those
ply of goods. On the demand side
have: (1) recent increases in
personal incomes and declines in
amounts
of
personal
incomes
saved; (2) the expansion of bank
we
credit, which increases bank de¬
posits, the money supply, and
expenditures;
(3) recent
credit, fol¬
lowing the abandonment of Reg¬
ulation W; and (4) a probable in¬
money
local
0.2
—2.7
-6.2
1.1
2.6
1.9
0.9
1.0
1.0
1.2
62.6
51.9
59.8
67.3
71.2
74.4
78.0
83.0
85.0
80.2
41.3
31.1
38.6
46.1
49.4
51.6
55.3
60.5
63.0
57.6
27.6
34.9
41.6
44.3
46.4
50.3
55.5
58.0
52.5
33.7
24.3
31.2
38.4
40.8
44.0
47.2
52.0
54.0
49.3
3.4
3.3
3.6
3.2
3.5
2.4
3.0
3.5
4.0
3.2
public debt, reflecting an upsurge
4.2
security
National defense
Other
and
1951
37.1
Govt, purchases of goods and services
Federal
National
12.5
the
of
likely to prove of about
type as the "inventory
recession" which occurred in 1941.
67.3
Services
decline
to date is
—1953
3.5
3.7
4.5
5.1
5.2
5.1
5.0
5.0
5.1
in
0.4
0.3
0.3
0.5
0.5
0.4
0.4
0.5
0.5
0.5
fense.
21.7
21.1
21.6
21.7
22.3
23.2
23.0
23.0
23.0
23.1
254.1
246.2
251.9
256.1
262.0
263.0
264.4
266.0
267.5
265.2
29.1
28.2
28.7
29.0
30.4
32.5
32.9
33.5
34.0
33.2
26.1
25.3
25.8
26.0
27.3
29.3
29.6
30.0
30.5
3.0
2.9
3.0
3.0
3.1
3.2
3.3
3.5
3.5
3.4
225.0
218.0
223.2
227.1
231.5
230.5
231.5
232.5
233.5
232.0
of
208.0
210.5
204.5
206.4
210.5
213.2
214.9
217.5
220.5
216.5
shift
17.0
7.5
18.7
20.7
21.1
17.3
16.5
15.0
13.0
15.5
disposition of Personal Income
Personal income
Less: Personal tax and nontax payments
Federal
State and local
Equals: Disposable personal income
Less: Personal consumption expenditures
Equals: Personal saving
'Estimated.
'
increases in consumer
crease
in the Federal
expenditures for national de¬
On
the supply side for
goods the following factors seem
to be of greatest importance: (1)
recent
30.9
deficit and
declines
inventories
in
of
goods,
retail level;
particularly at
the
(2) recent in¬
creases in wage rates, which exert
a
powerful influence on the cost
consumer
goods;
of
duction
and
(3)
resources
of
a
from
civilian
continued
the
pro¬
the
goods. It
should be noted, too, that while.
production
goods
of defense
to
<
Volume 176
Number 5154
...
The Commercial and Financial Chronicle
(1145)
this
investment continues to pile
productive capacity, during the
time that this capacity is being
them to produce at high percent- tors involved in launching the
ages of existing capacity and also product.
to expand their existing capacity.
Bringing in Potential Consumers
tip
increased payments of income are
Insofar
as
we
concerned with
are
of
flow
commensurate
goods
consumer
our
conciusiun
mat activity will
continue high. However, it should
be noted that rising priCes ere-
the market.
on
Monetary Factors
ine
muneiaiy
deserve
picture
^mnhasis
Federal
In
of
m
great
March
u.e
deal
nrioes
the
and
avoid.
the
1951
Board
economy
of
Fng
abandoned
pegging
their policy
prices of govern-
the
ment
bonds
led to
a
value
lacwis
a
Reserve
Treasury
ate stresses and strains within the
at
high
levels
and
higher interest costs
banks.
10
stable
Drices
ris-
or
We do not need rising
induce
the
develop- the laboratory shelf to
close
con-
sources
sion
However, the
ian
*a.ct> furnishes such information.
which the
use
live
to
deficit
ernment,
trillion,
additional
make
on
of
the
In those
functions of the useful information is acquired in
and to provide detailed the use or product research labuse data 1S' of course'
dependent oratory, patents relating to endl
"P°n the.company size and previ- use are a means of preventing
°US Palpation in the specific others from controlling the marVse fl?ld". However .crude the ket exposed by your research.
Je™°^™ P®r^nei meet witn chemical
a
comDanies nOTman^o
fivTorsiiS
personal contact.
devploomental
than
f'
The high cost of
calls
^eiopmentai
mOTe
and
thp
£egd thrieariy sta0gesPof deve<lopI
^fnt
work
it
lim-
"extreme
win
be
Gf
value
?
i
I ana me lim- lowing
in fol-
prize to be
prize to De sought
sougnt.
value in toi
initial contacts and
Since the
carry-
cal year ending
of
ptnt PrTduc^on^Sv
were used in the expantionship. If the product has merit,
capacity to produce civil- changes suggested by the cus-
goods
fcank
th^
investors
eff«:t wOuW
relatively'
Tie
more
tomer to visualize how the chemical will serve him
To accomplish
consumer's conSs
the
resources
+;ons.
We have been attempting a fore-
Ca^ for
the next ye«G and yet it
b*e note^tha^in
June, 1953. If the projections I have
bonds to be issued to finance
«ew
the
end
of
the
actual
mv
actual
my
current
calendar
foTals^
and
sooner
or
later the Federal Reserv!c Banks,
oaf
Hon
newgbonds.
these
This will
further expand the money
supply
tend to raise prices.
and
A
further
is
to
vanables
odds
what
guess
are
economic
the
going to do.
favVh^hlUels
of business
in
rise
prices will etary terms, to the middle of 1953.
tend to increase any economic seThe probable trends of the comjries which is based upon prices, ponents of gross national product
such
as
national product. It m the first and second halves of
gross
will
also, presumably, lend confidence to businessmen and induce
1953 may be summarized
fol-
as
lows:
Gross Private
Personal
Net
Consumption
Domestic
Foreign
Government
Expenditures
Investment
Investment
Purchases
Moderate
1953, First Half—
Decline
Stable
Rise
patents
Decline
Stable
materia
^mfthlperio^wLt^th'toduc* is j,n 1™ited s.uPPly-
.
impair the economy
and
.
-categorical
.
rather in
been
government
and+ definite m my
investment
an
a^J£ g^v^nro^lems"
in
one's
was
the
after
"World War II.
end
The postwar boom
mountable.
Government
insurhas far
formorethan better "laehmerj
csix years.
There are some signs declines in business activity tna
'that it is becoming old and tired, ever before and the potentialities
"When the present defense boom of the American economy for exIhas been going on
-slows down, there
is
a
strong pos-
•sibilitv that concurrent reductions
.
f
1
y
will enable us to cross
that bridge when we get to it.
pansion
other companies
These
sh0uld also be well-versed on
the
trends problems and
technology
0f
need
the
on
annarent
ic
•
w*
4*
Price Determination
maintain
files
of
arti-
cies, facts and figures on almost
•chemical is of great importance, every conceivable product or
Older
chemicals
performing
a group of products which are
now,
: similar
function may limit the 0r might be. of interest to their
:price and the relative efficiency company. Market Research Deof the new and the old products partments have become increas-
chemicanndifstry6
Each
in-
has
company
ties which favor
a
peculiariparticular de-
Staf*> str-ucture- The
comrxise^ofTroduct
partment
industrial
specialists
both
or
found most convenient
for
a
of
ingly important within every infortunate in this coun- dustry and, more recently, in the
trv to have so many sources upon chemical industry.
The men in
which to draw for our information these departments are, in effect,
We
•
are
demand.
Statistics trying to level our company flueare
becoming commonplace for tuations in the up-and-down cyalmost every segment of our econ- cles by forecasting the future.
on
potential
•omy.
The Tariff Commission re-
ports are growing more
•
every
Hutcheson
•
compre-
Analyses and interpretations of
supply
and
demand
and
of
the
and are but market trends are given to manone of several valuable references,
agement periodically. Just as these
Specific studies such as the one men keep aware of the probable
recently prepared by Kuhn and market for the "bread and butter"
hensive
chemicals
on
year
Ethylene
appear
Petro- items, they advise
with increasing the new product
frequency.1
•
If
the
on
potential for
based
known or presumed end
market examination be- make intelligent guesses
upon
a
use
development, both
fac-
now
a
stimu-
use
patents of others may
jeopardize
the
profit
from
great
so
not considered strong,
such
an
the
extent
ment
agricultural chemicals and in bio-
a
are
company
wish to discontinue develop-
may
greenhouses for
as
of
product
a
fl
distaste
the
because
of
a
LuT^ihl
bw
a
are
development sphere foresees
a po-
tential use, the product is given
general
observation
for
a
Soon
after
compound,
the
toxicology
aVoid
health
more
promise
in
is
specific samples
are
and
tion required for
uncovered
in
devel- search, the product is
product
be
proper
available
warning labels
re-
certainly
sent outside the
must
let be
within
a
on
to
the
When the chemical isr
cated uses. Should
logical out-
of
necessary
hazards
hensive testing covering the indino
synthesis
information
widely distributed to other
Only compounds laboratories
show
the
some
specific laboratory.
compounds.
A most
staff
product
and
for
for
when
com-
handling
use
on
distribu-
returned to tion.
——
———
on
participating
project.
Where It Comes From
Development Department
we
response to a
feel
sending,
In the
that
sample
any
merits
at
process of
"You have
new
least
convincing
that
necessary. It is wise
to present this information
using
the terminology
and
test
condi-
tions commonly accepted in the
industry contacted. For example,
a rubber research worker would
wish to see preliminary data on
the protection offered to rubber
by
a
new
antioxidant
before
evaluation
by him. This would
cad f°r tensile strength, elongation and other aging test data.
Normally,
a
use
research
——„
.
,
labora-
and
in*. DeP41951.
J.
w.
Hutcheson, Joint MeetManufacture and Dept. of
out to take
some¬
about America than that.
For
the
implication of that assertion
by the Democrats is that every¬
thing good we've got has
come
from the generous hands
and handouts of the present Ad¬
to
us
ministration.
❖
*
*
"Where has this
from that
come
the
great
from
in
of
men
strange idea
government is
provider?
It
comes
who have little faith
D.
D.
Eisenhower
the
people and small vision
what the people can do.
They
more
and
more
say we
must have
of the
people's affairs, because the people are less and less
able to manage their own affairs." — Dwight D.
government
management
Eisenhower.
Yes, and it
.
T.m«!!S OpUm°:S
are
from the American people. Well, X
know better than
you know more
away
know that you
that.
I know
that
_
hearing, as I have, that you
Republican party because
party and its candidates
thing good
re-
many cases,
been
better watch out for the
searchers that the product will
help them, data on utility
are, in
13,
for
as
later correspondence to
determine
the outcome of the investigation,
Kuhn
uses
unknowru Unless someone in the
given which
inforthe concurrent work to
various parties
in the
0ut when
activity with hundreds of other
within
tnfunction' furnish
atroismito of the
p °J
0pment
mation
and
on
the
assnmprf
that the venture is not attractive.
or
made in all phases
the
and outside the
company.
•
.must be known.
or process
a^ncultural cnenuca
tke development staff to aid in the pany,
approximation. Many Market Re- worth
searchers
many
thr0llgh contacts with the
and in b
distaste for law suits. Thus, the
same industry or in
development chemistry laboratories for fungi- importance of the development
of
a
product series, forms the ci(ies and bactericides. This screengroup keeping the patent departbackbone of the group.
ing, or product research, is carried ment advised is
obvious.
out end uses and to
convince the
trade that the product has
merit.
The
information acquired from
customers through a
sample follow-up program is oftentimes in-
Price determination for the new
the.
•
in
deter
or
our
attractive chemical is
an
taken in specialized research lab-
uals
utility, it usually remains for the
development department to seek
and
bv
-n
will,
Even when outside patents
oratories
price comes
sufficiently
involved,
a
ranee
of the proposed
chemical Market Research group, if one is fluential in directing attention to
thP indicated end use, if one
available, should be called in by unknown end uses. In our com¬
first
t
hurt to any company and, similar-
Research may also be under-
industry. The concentrated
background, acquired by individ-
product introduction is sometimes
enthusiastic because of obvious
Sales Development
For New Chemicals
dients for hydraulic brake fluid
compositions which surpass the
5nen mulatl0ns-
of
Although the
4
eiven
t
develonment of
'ul^hem wUhTelarefierlV^I fou.nd useful in brake fluid for"
The
(Continued from page
analysis
r»^o
manufacture to
of the
of problems created will be
The
fa-
has been
na
group
available.
It is the responsibility of the development
group
to
keep the:
Patent
Department
advised
of
new
product
status
during all
stages of sales development,
became commercial products when
in
BKsurjsjftAS "ttararxaass -ass JKSSSMS:
optimism than
true from this that I think that the
pr0'gress
'immediately
This
rnis
ofpSSSXL
market
outlook!
'
have
the
o£ the group must knQW
sales.minded
°Deriinea °
I
restrict
or
or use
seriously
ly, the necessity for licensing
.
h
Decline
Although
are
would
established standards. Our Dowanol series of glycol ethers and our
series of PolyPropylene Glycols
.
wCl
„(
UD
a^rt i?et pattern for development
Stable
uerqonnel
which
responsible for developing ingre- chemical.
Exclusive production of
fnrg^ ^can
dividual
Moderate
the
In return for their assistance procedures.
111 reLurn Ior meir assistance procedures,
the
Rise-
1953, Second Half
edeu'
So far Members
activity and some continued expansion, in real terms and in mon-
anfi
rem£
possesses either compound
of
do not alter the effectiveness and tI0"s and the Personnel are fa Patent Department
cost of purification may be avoid- ™liar with consumer industry situations, promote
only to
gone
non-inflationary, farther one goes into the future,
However, it is probable that the o£ eoursej the more hazardous it
■commercial banks
possibility of patent
the dfelopment pr0" ^JLicth al™ays exjfts; a pat<:nt
gram t0 °ther CUSt°merS'
m
be available for the
Gov-
estimated at about $7
a cash basis, for the fis—
where novel andL
cases
^ustlies Pro.c®®d"!S 2?™?!+ Tlfu study various
funds
Federal
Patent rrooiem
raieni Problem
re-
evaluation search laboratory is specialized to
would tomer can be incorporated to imuse
are
reproduced and studied
production of prove efficiency.
on a SmaR scale.
In our company,
defense goods. All possible busiCosts of increased purity must
^ve gan one such
group an Indusavailable to business through the ness
investment, as in the case of be balanced against the value to
trial Applications Research Labrediscounting process, with results municipal investment, should be the user and this information is
oratory.
This laboratory is
approximately the same as from postponed until the time when relayed to the
laboratory during equipped with
apparatus with
the pegging of bond prices.
Of there is a gap to fill elsewhere in the early stages of process develwhich to conduct realistic evaluaserious import also is the prospecjhe economy.
opment. Often, process impurities
Federal Reserve system has con-
tinued
await possible future investigation.
apTodiSft' aloS
t
funds, and it likewise diminished
the availability of funds from the
commercial
aesuaoie
seek
whom
maintains
businessmen, to
requhe
care
in
pilot
choosing
these
initial
contacts.
Use Research Laboratory
times a comnanv has nroceeded to.
capacity. To the argument that Factors which
determine this
The main objective of the use bring
rising prices encourage lirvest- choice include:
to
Progressive re- research
laboratory is to provide commercial or commercial manument, it may be replied that, i
search
department,
cooperative the data
such times as these, if less re- attitude
necessary for the cus- facture only to find that another
and previous sales rela-
borrowed
on
to
is
operate at high levels of existing
This
somew
prices.
11
should
falling
not
prices
decline in prices of stablesecurities
wnicn
We
"ie lmlial
.
with
staff
The degree to
.
being made to the owners of the a lorecast of business activity, it
factors of production constructing must be concluded that the
prosthe capital equipment without a pect of rising
prices strengthens
tory,
ment
37
comes
government
powers
from
men
somehow
who
seem
to suppose
embodies wisdom and
far beyond those of the men and women
it—that people who, cannot fend for
who compose
themselves directly
own creation.
their
can
do
so
via government of
}
38
The Commercial and Financial Chronicle
(114-3)
Continued
from
page
Continued from
16
first
mainder of this year
page
Thursday, September 25. 1952
...
and during the earlier part of the
next.
News About Banks
And Bankers
of
Association
ings
and
Banks,
was
an
St. Louis
officer and
Missouri, forerunner of
Banking.
the American Institute of
*
*
of
Bank
*
National
Northwestern
The
Louis, Mo. has
St.
converted into
been
state bank, under
a
the title of the Northwestern Bank
Trust
and
of
Company
St. Louis,
effective Sept. 1.
«
*
H.
A.
Pharr,
National
First
#
President of The
Bank,
announced
of
Mobile,
the
that
Ala.,
has
Board
of Directors at their meet¬
ing
Sept. 15, named James C.
on
Andress
Assistant Cashier
as
Andress,
these
duties,
before taking
was
an
up." They were already the most highly paid men
comparable skill, including those who work for far
more
profitable industries. It is likewise obvious that here
is an industry which can not in. any real sense "absorb"
higher wage payments. Figures are sometimes quoted
as
showing the industry earning large profits, but the
fact is that its assets are largely of the "wasting" sort,
and when depletion is fully taken into account a startlingly
different result is obtained.
But, of course, it is appar¬
ently taken for granted that the higher costs will be
"passed on," an assumption which raises the vital question
as to whether the operators
can get more for their coal
in existing circumstances. It also raises the question as to
what, if they can successfully raise prices, the effect upon
the entire economy may
and
He has
been with the First National Bank
since 1935.
to
From September, 1942,
1946, he served in the
United States Army, attaining the
rank of Captain.
June,
*
*
*
Lyston G. Jaco, Jr., was recently
elected
Assistant
Secretary
of
California Trust Company, of Los
Angeles.
A graduate of the Uni¬
versity of Michigan Law School,
Mr. Jaco has been with the trust
company
since October, 1949.
*
❖
Bank
new
Los
of
nounced
that
building at 10925 Kinross in
Westwood
of
Angeles, has an¬
bank's modern
the
Village,
Kinross
opened
on
block
one
and
at the corner
Gayley,
was
Sept. 8; the building is
west of the present
quarters at 1088 Westwood Boule¬
vard.
increases
too
de¬
may
parts of the market, although what ap¬
reversal of Federal Reserve policy last
brought much greater ease to other segments of the
some
week
a
market.
certain of is this: If the
impression is
that the Reserve authorities have gone
back to the extreme easy money attitude of recent
years,
or
anything very like it, the system could once more be
regarded as an "engine of inflation," with consequences
What
we
are
gained broadly
hard to foresee.
In such
might well take
price
an
event
recent
increases
wage
major significance.
on
Continued
from
4
page
Savings Banks' Hazards in
Common Stock Investments
get the higher prices—but when the time finally arrives
when it is
longer possible to levy these higher prices,
higher costs (whether labor or otherwise) tend to curtail
production/ cutting it back usually to the most efficient
producers. This latter process, of course, tendsjo reduce
the rate of output of the industry concerned, and the
volume of employment it provides.
When
a
no
this
becomes widespread—and it has
process
companies whose prospects justify
issue
the expectation of a high degree
of stability in dividends. It is un¬
premise that
have
tendency to spread throughout industry — we
depression factor actively at work. At such a time,
a
further
increases are unlikely—and "the last in¬
to be deflationary rather than the opposite.
wage
crease" proves
Whether we have
have not reached such
or
the coal settlement, we
a
climax with
would not undertake to say. Cer¬
who would deny it, many v/ho look
bigger and better boom for months to come.
Not a few of these are men of seasoned judgment. Some
of them at least certainly do not approve of much that
is going on; they are merely trying to understand and
appraise the future. We must, of course, admit at the
same time that here and there signs appear of some falter¬
ing. Certain of the official prognosticators in Washington
tainly, there
forward to
are many
a
be
to
little
a
exuberant
less
a
large
we
no
their
the
System to the govern¬
re¬
The
real
we do know, and what we wish at this point to
plainly and as forcefully as we know how, is that
conditions may and do arise when even monopoly must
bow to conditions far beyond its control. To the casual
observer it would appear clearly a fact, that conditions
now
existing in the coal industry are such as to render
the wage increases now granted mere or less illusory to
the wage earners who are supposedly the beneficiaries.
The stock of coal above ground is huge; the industry has
been able to work only on a part-time basis for a good
while past. Mr. Lewis with his hypocritical "memorials"
has not made any appreciable headway in reducing these
stockpiles, and it would take a long while for him to
full-time
point where anything approaching
operations in the coal industry are feasible. The
experienced observer will await with interest the atti¬
lighter tax levy on
dividend in¬
is to invest in
good-quali'ty
the present
market, the yield differential be¬
tween good preferreds and com¬
In
stocks.
preferred
real
with
stocks
mon
defensive
strength is comparatively modest.
The
rewards
for
accepting the
junior equity position-are not im¬
pressive. Since there is-no com¬
pulsion to enter the common stock
field, taking even moderate risks
without the possibility of generous
rewards has little appeal.
has
It
that in
buyers to prices higher than those they have
paying.
been
stocks there is no
common
defense like
stated
aptly
very
good offense. If the
a
difficult
generally
sees
is
in
the
on
best
manage¬
which
companies
low
at
and that
who
levels
none
act
stock
any
of
the
on
is attrac¬
the
market
is suitable for
long-
investment at high levels.
Experience shows that selection is
range
in reality far more important than
timing except during such periods
have
have occurred
once
twice
or
decade. To illustrate the
readily
can
dozen
call
or more
to
their
a
we
half
a
leading investment-
type stocks which
low
point,
mind
as
in
selling be¬
are
prices
average
last fifteen years, even
of
the
though the
general market for issues of good
quality is far above the levels pre¬
vailing during that period.
The
bond
this
contrast
all agree
ket
with
high-grade
investing is also notable in
matter of timing.
We would
is
bond
that when the bond
at
is
peak
a
a
versely,
purchase.
poor
when
mar¬
high-grade
any
bond
Con¬
prices
scraping bottom, almost
are
good
any
bond is attractive. The high-grade
bond market, we can say, is rela¬
tively
homogeneous,
unison,
and
does
individual
moves
show
not
variations
in
many
from
the
composite index.
In contrast, the stock market is
potentials for long-range not one
market but many individ¬
expansion. The pur¬ ual ones.
We have often seen in¬
pose of diversification, therefore,
dividual groups moving in oppo¬
is the positive one of seeking to
site directions at the same time
provide adequate representation and
under the same general eco¬
in sound companies and industries
nomic
conditions.
The
widely
which have real potentialities for
used market averages simply tend
the
future.
This
is
quite
the
strong
growth and
to obscure the diverse movements
opposite
sought
portfolio,
limit
to
the
diversification
bond or mortgage
of
for
a
objective is
by avoiding heavy
in any one invest¬
where
losses
concentrations
the
ment. In common stock
investing,
should not diversify
simply to
we
limit
our
losses. After
do that with much
by
not
buying
all,
we can
certainty
more
the
in
any
first
which
My
that
pect
the
recommendation,
over
gressive
period
a
thoughtful,
careful,
investor
of years
and
ag¬
make
will
out
aporeciably better than the mar¬
ket indexes, even though his abil¬
ity to foretell changes in the gen¬
eral level of
than
better
prices
may
prove no
average.
recommendation,
third
Mv
second
constantly taking place.
are
Thus it is quite reasonable to ex¬
place.
therefore, is not to be on the de¬
therefore, is not to give too much
emnhasis
to
what is commonly
called
anything in the
Whether the
course
of business
during the months im¬
way
accomplish
of improving
earnings through the small invest¬
permitted under the law, it
will have to be a predominantly
ment
mediately ahead is such
price increases and for
will
depend
upon a
the
coal
steel
or
as
to support recent wage and
of the
more
situations,
of
course.
upon
expenditures, including foreign aid.
in substantial
erally. The
animal.
He
consumer
at
times
that he act with
much
sort to
come
the
It will depend,
course
of defense
It will be governed
part, too, by the attitude of consumers gen¬
is ordinarily
rushes
in
future needs when calm business
as
same
number of circumstances other than
obviously, in considerable part
be
those
fensive. If you hope to
tude of coal
been
regu¬
and' at the same
tirpe to enjoy the benefit of the.
reliance
as
a
obtain
to
way
larity of income
come
tive
with
of extreme market fluctuations
minority.
times ahead for business, his best
What
reduce inventories to
that such "defensive"
be distinctly in the
but I argue
issues should
ments
state
the
from
investor
way
to moderate
fluctuations in the
stock portfolio,
of
range
income
forecasts.
is in any manner to be
of knowing.
way
have
in
desirable
questionably
definite
Stubborn Conditions
in
easy
peared to be
cryptic statement undertakes to say is apparently
increases normally increase costs and in the end
directly or indirectly in a competitive economy rising
costs tend to increase prices—so long as it is possible to
lated to all this
must carry on I
They
part at least be determined
by, the attitude of the authorities in the monetary and
banking field. As every one knows, money until very
recently has been much "tighter," as they sav in Wall
Street, than for a long while past. It still seems to be none
rather
ment market in
CROSS
of the factors.
some
"inflationary" until the last one. What this
are
Whether the return of the Reserve
RED
some
termine, and doubtless in
that wage
seem
Your
only
are
Inflationary?
^
H. D. Ivey, President of the Cit¬
izens National Trust &
Savings
be in the course of time.
It has been said several times of late that all
over
Assistant
Trust Officer of the bank.
These
of
Manager of the Bond Department.
Mr.
■
"catch
director of the Bank Clerks Asso¬
ciation of
Monetary Factors
See It
We
As
stubborn in
depends
greater caution.
a
to
rather unpredictable
buy for current and
judgment would suggest
At other times he
staying out of the markets.
now
upon
can
Obviously
what he does during the
re¬
aggressive
you
stand
an
30%
"outlook
for
the
mar¬
time, enersy, and
judgment applied to the selection
of
same
individual
much
stocks
will
productive.
more
prove
One solu¬
Otherwise
tion
for
bad
timing in making stock pur¬
or
even
showing
period of years. Truly
"defensive" stocks should not, in
my
the
The
excellent chance of
portfolio.
proving nothing
losses
ket."
the
chases is to
problem of avoiding
use
some
variation of
over a
opinion, constitute more than
to 40% of a common stock
that
Timing Isn't Everything!
stock
common
chases.:. Obviously
I
pur¬
would
not
arguejhat proper timing is unim¬
portant in the
vestment
a
minimum dollar amount
to be invested each month or each
quarter,
My third point has to do' with
of
setting
approach. By
%
commitment.
the tuaaing
the dollar averaging
success
nroeram.
hut
of
I
any
do
in¬
take
the
pleted in
such
mit
program
an
plan
the
will
orderly
provided
be
manner.
com¬
Any
should, however, perr
investment
amounts
tunities
is
assurance
as
of
additional
advantageous
occur.
oppor¬
This procedure ob¬
viously will not result in perfect
Volume 176
Number 5154
The Commercial and Financial Chronicle
...
(1147)
timing, but it will
better
than
at least
assure
but it
come
also
was
providing
market
ing these remarks, I should like
simply to plead the case for a
The depreciation from book
amounted to 23.1% compared to
results.
average
aynamic investment policy ap¬
propriate to the dynamic economy
greater
immunity
from
no
risks.
A Case in Point
v
Thus far I have made three
ommendations
operating
fctock
subject of
savings bank common
a
They
for the Aggresive Group.
While
I
have
quite properly
given
primary emphasis to rates
be
may
informally in
expressions:
(2)
last
week
(3)
Timing isn't everything!
was
valued
opinions.
cur
They
stocks
mon
and
from
actual
In
order
com¬
long-term invest¬
be illustrated
can
to
explore this record
over
reasonable
a
also to
deal
with
the
the investor
was
making his stock
at
the
May, 1946
commitments
You
will
Dow-Jones
recall
reached
212.50
broke to
a
lowing
within
a
163.12
in
from
market
made
that
at
the
Therefore,
the
the
present
purchases
highest nrices
reached
during the month of May,
1946, we are making full allow¬
ance for bad timing.
Presumably,
also,
that
'"defensive"
moderate
time
stocks
the
in
occur
the
was
in
losses
to
Aggressive
almost
at
decline..
Group,
above
rather handsome
tection against the
market
Group
63%
pro¬
possibility of
The
a
Defensive
the other hand, still
depreciation of 8% from
on
showed
a
cost.
footnote
a
tration, I made
tation.
made
This
out
other
one
was
to this
illus¬
compu¬
how the investor
by purchasing at their
May, 1946, high still another group
of aggressive stocks not included
in the Dow-Jones Industrial Aver¬
These
age.
even
were
mort
stocks for which
dynamic future
was
preaictable at that time They of¬
fered the meagre return of 2.18%
and shared to a slightly greater
extent in the decline to the Octo¬
the yield
1949,
on
from
and
we
By JOHN T. CHIPPENDALE, JE.
In this atmosphere
panies
do
either
"show
not
stand
Common
ground.
risks
as many
However,
that
the
as
I
savings
banks,
either
holder
their
out
of
the
mutual
equities
storms
who
stresses, dis¬
intermediate
market
regard
swings, and ultimately receive his
compensation in the form of a
handsome
addition
to
earning
power.
Actually,
improved to 4.45% and the depre¬
visible to
ciation had shrunk to
seek
scant 7%.
the principal hazards
are the temptation to
me
high immediate yield
a
Last week these stocks were pay¬
an
ing 6.44%
"defensive"
cost and showed
on
a
market value 130% above book.
that if
There is
any
further. In clos¬
we
chence
need to belabor my
no
three points
stocks.
to
lesson
I
surrender
we
pulses
Conclusion
and
excessive devotion to so-called
stand
learn
in
afraid
am
to these
only too
how
to
im¬
excellent
an
well
lose
a
money
prudently.
first postwar market peak.
Treasury financing will continue to exercise con¬
siderable influence upon the
government market for the immedi¬
ate future. There is still a
fairly sizable amount of
swopping being done
the
six
which
tentialities.
Defensive
sive
had
the
most
I
shall
call
slightly longer maturities of short-term issues are being looked
by those that seemed to have been obsessed with a liquidity
(above all things) complex. The rush to
get the very shortest
maturities of government
to
bring about
This
is
Group and the Aggres¬
were
in¬
vested in each of the 12 stocks.
The
Defensive Group
offered
a
3.63%, while the
Aggressive Group provided a re¬
turn
of
ential
years
2.94%.
did
not
But
differ¬
long.
last
this
Three
later, in June, 1949, the De¬
Group
was,
producing
fensive
4.68%
book
on
cost
the
but
At-
gressive Group yielded 5.51%. As
of
last
week, the results were
more
favorable to the Ag¬
gressive Group.; which returned a
7.97% rate on the original invest¬
ment compared with 4.78% from
the Defensive Group. The record
clearly shows that the yields in¬
even
dicated
in
May, 1946, were not
reliable guide for the future.
a
I
appreciate, of course, that for
the most part the last six years
have witnessed a high level of
business activity. It might be ar¬
gued, therefore, that the illustra^
tion I have given is valid only
under favorable conditions.
ever,
the
period
from
How¬
the
May,
1946, high to the June, 1949, lows
was
full of uncertainties and the
slide
in
1949
stamina
the
and
Group.
business
of
which
occurred
sufficient to test the
was
the
Defensive
Group
the Aggressive
of
drive
Yet we find that the Ag¬
gressive Group provided
tinctly better return.
What about the
a
exposure
case
can
final
step in simplifying
and rationalizing the capital struc¬
for
a
problem of
taken
was
years
current return of
ket
The
respectively in de¬ ture was announced last week by
the results.
I assumed Seaboard Air Line. The first step
scribing
in
Seaboard Air Line and Missouri-Kansas-Texas
Group
that equal dollar amounts
dis¬
mar¬
in stocks? Perhaps
Defensive Group
the
be made on the grounds that
they provide greater resistance to
market declines.
From its May,
but it does not last very
long because, with the passage
time, comes the clearer less emotional type of
thinking which
eventually puts yields and prices back in line again.
3%
4s
were
coupon.
instituted
and
two
and
half
a
when the original First
ago
Mortgage
a
almost
refunded with
Then the company
aggressive purchase
an
and traffic. It is
quarters
stock
the
to
to
loss of 22.1%,
culminated
the
a
refunding
fixed
interest
This
short
ago
sold
was
the
in
of $25,000,000
compared
$52,500,000 of the Income
amount
with
general business
expected in many
the
the
preferred
way
once
mon
that it will sell at
relationship
directors
more
a
realistic
earnings.
to
last
develop¬
generally stable market
a
week
the
was
pressure
Missouri-Kansas-Texas
stock.
on
common
The last of the interest
ar¬
the Adjustment 5s will be
rears on
that
in
been
the
elimination
Capital
Fund
dividend
of
dividend
in the reorganization.
on
Dec. 1, 1952 of the
5%
preferred.
This stock, out¬
standing in the amount of only
$15,000,000, is callable at par. With
dividends
to
accrued
plan
accruals
mulative
interest
of
care
had
that
bond
capitalization
The final step is the calling for
redemption
taken
and
requirements
restrictions
been set up
onerous
the
once
the
preferred
formulated
and
stockholder
that
been
drawn
such
that
have
been
not
a
up,
probable
7%
cu¬
would
be
for
presented
approval.
cated
re¬
eliminate
to
on
had
stock
a
all
It
plan
indi¬
is
has
now
it
although
the
of
is
details
fully refined.
redemption
Last week's selling pressure on
date, however, it actually works
out to $105.28 a share.
The pre¬ the common is generally attrib¬
to
realization
on
the
ferred is convertible into common uted
part
stock
on
share
a
share
for
basic.
Considering present market con¬
ditions, it seems likely that a large
part of the issue, if not all of it,
will
be
comes
converted.
were
also
The
old •-In¬
convertible
and
when they were called holders of
$5,859,000 exercised the option. If
all of the preferred is converted,
it will add
another 150,000 shares
outstanding common, bring¬
ing the total to 1,058,590 shares
compared
with
850,000
shares
to the
originally
issued.
of stockholders that any
would
have
any
1949,
charges,
the
and
restrictive
the
elimination
indenture
the
lows,
not
the Defensive Group
only
producing less in¬
Treasury bills into the 2V8s of Dec. 1, 1953.
Despite the activity and volume which is keeping the shortest
term obligations in the
spotlight, there appears to be a somewhat
greater interest developing in the rest of the list,
especially in the
these
of
necessity involve a sharp
cutback in the equity of the com¬
mon.
Earning power of Katy is
such that nothing more than an
equal par value of new preferred
offered
io
the
present
preferred and at that the new pre¬
ferred, whether it be in one or
two
series, will have to
of
provi¬
carry an
aggregate of less than the present
$7.00 a share dividend. For their
the opinion
have
any
increase
even
after
in the amount of stock
outstanding
present
the
be
to
company
should
able
to
of most analysts who
studied
its
Katy
recommend
the
situation
recent
it.
that
decline
common
various
and
no
has
the
little
certain
of
the
really substantial
issues
set
maturity
obligations.
fanning out in volume in
although there has been somewhat increased
This is due mainly to the realization
by many institutions that their maturity distribution was not as
good as it should be and they have been taking advantages of this
opportunity to remedy the situation.
New 2%s in
Spotlight
The 2%s of 1958 appear to be the center of
considerable activ¬
ity, with advices indicating
a
broad trading market in this issue.
Although yields have not yet reached the
level
supposed to be a sizable demand around for this
been increased volume in the 1958
Some believe
advantage to trade out of the 2%s, take
hand, there
current
are
levels, and
as
those that hold
a
buying of this security.
there
is
Dec.
the
result they have
it
is
to
their
tax loss, and put the
a
proceeds into the recently offered 2Vgs of
other
where
bond, there has
maturity because of the switch¬
ing into and out of this obligation.
2%s
1,
1953.
are
stepped
On the
attractive
up
at
their scale
This has helped to bring about
active
an
two-way market in the 2%s of 1958.
Long Bonds Listless
ac¬
would of
be
bonds
has been
takings of these obligations.
The longer end of the list has not been
very
ceptance of preferred stockholders
can'
many
note, and
proceeds going
been made from
plan that
chance
were
of the 14-month 2V8%
Treasury obliga¬
tions wondering if they might not have been a little
hasty in what
they did. There have been many instances in which switches have
4J/2S originally outstanding. These paid off on October 1. It has gen¬
bond operations were important erally been expected, supported by
statements from the management,
not
only in that they reduced in¬
terest charges. They also resulted
use
liquidation that took place in the maturing October certifi¬
not due entirely to the
maturity problem. Some of this
selling now has the owners of the very shortest
shorter-term
The only other notable
ment in
question, that there
any
to
was
There
Missouri-Kansas-Texas
in
the balance by
37/8%
Debentures.
issue
new
time
of
performance not enough better sions have far
outweighed
impress anyone.
At the June, dilution. Even with
was
evident, beyond
of the
share at the
take action to split the com¬
stock. If so, it appears likely
may
with re¬
4V2S.
This
Income
that
is out of
retirement program
spect
level, of
current
a
back dividends, then, and to com¬
the Dow-Jones Indus¬
While the operations of the cur¬
trial Average declined to its Oc¬
rent year have resulted in some pensate,them for a reduction in
tober low by 23.2%. This is almost
their dividend rate, old preferred
dilution of the common stock, this
stockholders will have to be given
exactly the extent of the deprecia¬ dilution has not
been great.
Cer¬
tion suffered by the Aggressive
4the major
tainly the benefits derived from
portiqp of the new com¬
Group at the October lows for reduction in
senior securities and mon stock. Wi^this
view it is
each, stock. The Defensive Group,
however, showed a
was
led
cates
least $17.00
at
earn
1946, high
a
that has
selling of the October l%s with the
largely into Treasury bills and some of the shorter maturities of
certificates. However, it was reported that not a small amount
po¬
the
obligations could not do otherwise than
in yields
among the various issues.
happened on numerous occasions in
distortion
a
condition
a
the past
this
dy¬
these
switching and
being made in order
are
at now
accounts that could not make
the six
long-range investment
portfolio changes
Many Ignored Exchange Offer
were most
highly regarded
having defensive strength and
namic
as
to adjust positions to the needs
of investors in government
obliga¬
tions. To be sure, the greater amount of
this activity has been
concentrated mainly in the shorter-end
of the list.
The desire, if
not the need for
liquidity, has had a very telling effect upon the
trend of the nearest term rates with the
result that some of the
It
which
as
conditions tight.
money
Liquidity Prime Market Influence
30
stocks then contained in the Dow-
Industrial Average
give ground, with
The recent
To avoid any questions of hind¬
Jones
to
any
money
Because of
of
this
sight^ I simply picked from the
Competition for
port.
ride
can
and
markets.
money
keeps
directly or
fund, can
have a very
satisfactory invest¬
ment experience. They are
in the
position of the true long-term
through
taking
the
keen, with loans expected to expand further.
The intermediate term issues as well as the
longer-term obli¬
gations have been on the defensive, because there is no
desire on
the part of prospective
buyers of these securities to do other than
to wait and see where
they are going to stabilize. Scale orders on
the downside have given
only temporary stabilization to certain
of these securities.
Switching has also provided some minor sup¬
confident
am
mutual
investing
then,
carry
they always
stocks,
off
pressure
the exception of the shortest
maturities. The demand for
Treasury
bills and other near-term
obligations has been strong, which makes
liquidity preference about as prominent as it has ever been. It
is believed this could make the shortest
Treasury obligations vul¬
nerable.
However, there is not likely to be too much change in
this attitude as
long as Federal
they
they
or
still
this, the government market has been forced
a
com¬
still;
progress
gradually lose
have.
than
more
the
is
see
becoming
they have been for
decade.
of
Looking
competitive
stronger
than
can
Governments
on
Despite the large assist from the Central
Banks, the October
refunding of the Treasury has been carried out without
management
poor
just deserts.
forces
book cost had
a
Reporter
loss
.
an
to
micht
rewarded
just
as
buy
order
which
reaction
any
the
June, 1949 low ber, 1946, lows. However, by June,
which
started.
assuming
were
the fol¬
October, and fluctuated
relatively narrow range
161.60
bull
the
Average
that
month,
in
low of
until it reached the
of
that
IndustriaL
should
profit and
a
where the consumer is
Good management is still
passing that at the end of ahead
cost,
Just
problem of timing, I assumed that
highs.
book
experience.
experience
period and
the results of
of handling
for
they
simply personal
are
many years
ment
of
not
are
We
in
Our
Fortunately,
economy
receives its
market.
invest.
we
live
king.
note in
These
still
of return and market
exposure, we
should not ignore behavior in a
Put away your yield book!
Don't be on the defensive!
(1)
which
in
we
favorable
rather
summarized
21.8%
the
on
portfolio.
three
rec¬
39
it has had somewhat enlarged activity.
been
modest
active, although
State pension funds have
buyers from time to time in the largest tap bonds.
There has al^b been
some
scattered
purchases by private pension
funds, although these institutions have been
much more concerned
with private deals and corporate bonds than they have been with
the
highest yielding Treasury obligations.
have
much
taken
more
on
some
interested
Savings banks
of the
of the
on
in
Private trust accounts
longest Treasuries, but they too
the corporate bond
are
market.
balance have been modest sellers of certain
long-term issues with the proceeds going mainly into mort¬
gages and a few selected corporate issues.
mercial
banks
are
the government
The metropolitan
com¬
evidently not interested in buying income in
market, other than in the short sector because of
the loan demand.
The suspension of Regulation X had been long anticipated by
the money market.
loans
for
would most
markets.
If there should be
an
appreciable increase in
housing because of the lifting of these restrictions, it
likely tend to keep the
This, however,
appears
pressure
longer
on
the
r~^ncy
to be a very debatable point."
40
The Commercial and Financial Chronicle
f1148)
The
Indications of Current
following statistical tabulations
latest week
Business Activity
week
or
or
Latest
steel operations (percent of capacity)
Indicated
Month
Week
Ago
ingots
99.6
(net tons)
Sept. 28
2,069,000
*2,121,000
2,041,000
galUns each)—
—Sept.
runs
to stills—daily average (bbls.)
Sept.
Gasoline output (bbls.)
Sept.
Kerosene output (bbls.)
Sept.
Distillate fuel oil output (bbls.)
Sept.
Residual fuel oil output (bbls.)
:
:
Sept.
Blocks at refineries, bulk terminals, in transit, in pipe lines—
Finished and unfinished gasoline (bbls.) at
Sept.
Kerosene
(bbls.) at
Sept.
Distillate fuel oil (bbls.) at
Sept.
Residual fuel oil (bbls.) at
Sept.
CONSTRUCTION
ENGINEERING
13
6,460,500
6,441,550
*6,278,000
6,282,200
117,059,000
7,021,000
7,177,000
6,544,000
13
13
13
13
24,132,000
23,220,000
23,128,000
2,512,000
10,388,000
2,591,000
2,657,000
2,558,000
10,612,000
10,342,000
8,833,000
TION
8,523,000
8,822,000
8,720,000
8,598,000
—U.
S.
June
<000's
KDISON
output
New
108,641,000
106,326,000
95,280,000
99,431,000
New
53,274,000
53,275,000
51,959,000
49,079,000
(in
Sept. 13
881,218
746,044
805,704
850.812
—
(no. of cars)—Sept. 13
691,166
585,870
660,924
670,779
building
$264,618,000
$237,500,000
$232,381,000
130,686,000
126,482,000
75,127,000
63,843,000
129,809,000
138,136,000
162,373,000
168,538,000
—Sept. 18
86,344,000
84,816,000
56,739,000
43,465,000
53,320,000
105,634,000
67,193,000
=
—
DUN
VALUA¬
THE
U.
S.
Month
—
of
omitted):
504.352
690.714
204,635
235,871
107,346
104,871
99,899
$2,210,572
$2,310,504
$1,145,715
601.455
alterations,
GINEERING
etc
CONSTRUCTION
NEWS-RECORD
—
EN¬
Month
—
of
(000's omitted):
U.
S.
Private
construction
construction
Public
503,431
State
and
municipal
606,317
1,707,141
construction
1,704,187
544,260
294,149
449,703
376,837
1,412,992
1,254,484
167.373
25,850,000
31,405,000
34,103,000
2,663,000
•2,484,000
3,514.000
225,900
64,800
613,000
$21,200
$20,958
$21,324
14,732
14,405
14.784
8,021
7,813
8,082
Automobile
4,602
4,446
4,582
Other
3,419
6,711
3,367
3,500
6,592
6.702
6.468
6,553
6,540
3,980
3,952
Federal
COAL OUTPUT
(BUREAU OF MINES)—Month
August:
9,900,000
10,918,000
698,000
711,000
784,000
85,500
*61,900
Pennsylvania
67,900
133,100
Beehive
114
100
95
114
7,724,664
7,654,324
7,718,064
7,013,950
&
Sept. 18
Bituminous
coal
and
lignite
anthracite
coke
(net
(net
(net
tons)
tons)
tons)
;
CONSUMER CREDIT OUTSTANDING—BOARD
GOVERNORS
SERVE
credit
Total
145
91
154
160
Sept. 16
4.376c
4.376c
4.376c
$55.26
$55.26
$55.26
$52.69
Sept. 16
$42.00
$42.00
$42.00
$43.00
of
as
FEDERAL
July
RE¬
short-term
31:
credit
consumer
Loan
THE
Estimated
—
millions
Instalment
4.131c
Sept. 16
lb.)
OF
SYSTEM
in
Sale
credit
credit
credit
:
Noninstalment
credit
Charge accounts
Sept. 17
Sept. 17
at—
at
at
Zinc (East St. Louis) at
PRICES DAILY AVERAGES:
U. S. Government Bonds
24.200c
34.900c
Sept. 17
Sept. 17
Sept. 17
Sept. 17
refinery at
Export refinery at
(New York)
$1,026,484
74,191
$813,858
OF
INDUSTRIAL)
AND
Domestic
(St. Louis)
62,867
254,790
•9,125,000
(E. A M. J. QUOTATIONS):
Electrolytic copper-
Dead
46,547
464,538
925,000
KETAL PRICES
Dead
OF
LABOR
construction
11,825,000
Sept. 13
100
kwh.)
(New York)
11,244
44,522
(tons)
RESERVE
Pig iron (per gross ton)
Scrap steel (per gross ton)
Btraits tin
of
AREAS
OF
ENGINEERING
of
Sept. 13
Sept. 13
Sept. 13
—Sept. 20
AVERAGE
CIVIL
101,345,000
(tons)
SALES INDEX—FEDERAL
(per
96,919
$826,674
Total
$260,495,000
BRADSTREET. INC.
steel
43,353
nonresidential
DION AGE COMPOSITE PRICES:
Finished
period
76,930
78,435
96,651
(tons)—
residential
August
ENGINEERING
—Sept. 18
000
end
URBAN
Additions,
Sept. 18
(COMMERCIAL
All
at
DEPT.
35,307,000
INSTITUTE:
ELECTRIC
Electric
FAILURES
period
CONSTRUCTION PERMIT
IN
124,135,000
(tons)
SYSTEM—1947-49
BUILDING
29,721,000
municipal
DEPARTMENT STORE
74,035
78,167
orders
115,979,000
—Sept. 18
coke
Unfilled
•33,223,000
GOAL OUTPUT (U. S. BUREAU OF MINES):
Bituminous coal and lignite (tons),
Beehive
(tons of
21,720,000
—Sept. 18
anthracite
output, all grades
of
end
116,830,000
Public construction
Pennsylvania
Ago
(tons of 2,000 pounds)
at
33,724,000
construction
and
Stocks
117,296,000
construction
State
smelter
13
NEWS-RECORD:
Private
Year
Month
INSTITUTE, INC.—Month of
pounds)
13
13
13
13
(number of cars)
freight loaded
Revenue freight received from connections
Total U. 8.
of that date:
Previous
RAILROADS:
AMERICAN
OF
Slab zinc
Shipments
42
dTIL
2,125,000
(bbls. of
average
Crude
Revenue
AMERICAN ZINC
2,000
INSTITUTE:
and condensate output—daily
ASSOCIATION
are as
Month
102.1
rETROLEUM
oi
Crude
of quotations,
cases
August:
castings
and
in
or,
either for the
are
Latest
Equivalent to—
Bteel
AMERICAN
that date,
Ac
•102.1
102.3
Sept. 28
production and other figures for the
cover
Year
Week
STEEL INSTITUTE:
AMERICAN IRON AND
Previous
on
Thursday, September 25, 1952
Dates shown in first column
month available.
month ended
...
121.500c
24.200c
24.200c
34.975c
34.300c
121.500c
103.000c
1,442
1,436
1,448
Service
1,135
1,137
1,140
79,615
*81,601
95,366
96,049
79,613
126,941
115,179
104,938
83,771
73,657
70,937
27.425c
121.500c
3,891
Single payment loans
24.200c
16.000c
16.000c
16.000c
17.000c
15.800c
15.800c
15.800c
-16.800c
14.500c
14.000c
14.000c
17.500c
MOODY'S BOND
COPPER
credit
INSTITUTE
Copper
For
—
production
in
U.
month
S.
of
"
August:
A.—
'
Crude
(tons
Refined
(tons
Deliveries
Sept. 23
96.42
97.12
97.04
98.81
In U.
Average corporate
Sept. 23
109.42
109.60
109.60
111.62
Refined
Aaa
Sept. 23
Sept. 23
113.89
114.08
114.08
116.41
Aa
111.81
111.81
112.00
Sept. 23
109.06•;
109.06
109.06
110.34
Baa
Sept. 23
103.47
103.64
103.97
105.00
Sept. 23
Sept. 23
106.39
106.56
106.92
108.34
109.24
109.42
109.42
111.25
Sept. 23
112.75
112.75
Corn,
112.93
115.43
Wheat,
2,000
of
pounds)
2,000
pounds)
73,324
customers—
to
115.43
A
of
Railroad Group
Public
Utilities Group
Industrials Group
MOODY'S BOND YIELD DAILY AVERAGES:
Sept. 23
Average corporate
Sept. 23
2.71
3.20
2.71
319
Sept. 23
2.96
2.95
Sept. 23
3.07
3.07
———Sept. 23
3.22
_
CROP
•
2.58
3.19
2.95
PRODUCTION
Railroad
Public
all
All
Other
MOODY'S
(tons)
Percentage of activity
Unfilled orders (tons) at end of period
OIL, PAINT AND
AVERAGE
DRUG
REPORTER
3.15
3.51
3.45
3.34
3.26
3.21
3.20
3.20
3.10
Rice
3.02
3.02
3.01
2.88
Sorghum
426.5
424.5
432.7
457.3
241,601
269,531
194,899
201,011
233,756
219,857
222,702
DEALERS
175,730
Sept. 13
Sept. 13
Sept. 19
SPECIALISTS
AND
ON
Y.
N.
72
89
94
480,274
488,931
431,711
538,949
109.48
109.11
108.86
116.61
STOCK
orders
Sept.
6
19,632
24.301
25,553
Sept.
6
532,684
548,682
697,796
754,988
Sept.
6
$24,707,669
$25,125,125
$32,123,853
Sept.
6
17,577
18,101
20,890
by
dealers
(customers'
Customers'
short
other
sales
Sept.
short
value
Round-lot sales
$33,031,337
6
106
110
85
24,588
166
3,649
3,776
2,887
5,840
Cherries
(12
6
466,577
485,921
586,227
700,164
Apricots
(3
6
$19,269,163
$19,946,318
$24,478,557
$28,476,518
6
142,870
149,240
6
6
142,870
149~240
1~6~6~740
222,380
Sept.
6
201,730
220,310
273,750
266,030
166,740
SALES
ON
THE
NEW
Round-lot
OF MEMBERS
Total
Aug. 30
FOR
ACCOUNT
OF
124,940
4,578,730
4.691,310.
5,247,660
7,394,310
Aug. 30
Transactions of specialists in stocks in which
Total purchases
of
4,703,670
4,845,920
5,467,210
7,676,500
154,610
219,550
282,190
RECEIVED
S.
of
June
Aug. 30
450,960
479,350
538,450
OF
22,439,000
25,067,000
24.259,000
18,901.000
14,812,000
98%
90%
Aug. 30
408,860
498,390
562,750
the floor—
Total purchases
Short sales
Aug. 30
5,200
74,700
10,900
Other sales
Aug. 30
70,130
74,400
Aug. 30
75,330
85,300
Aug. 30
sales
Other transactions initiated off the floorTotal purchases
86,400
799,800
Feed
772,350
107.340
177,770
175,745
203,035
Aug. 30
16,460
17,690
43,670
Other sales
34,230
Aug. 30
198,690
228.317
215,150
246,007
264,565
308,235
333,470
Aug. 30
sales
Aug. 30
Aug. 30
94,170
114,120
Other sales
179,770
199,140
Aug. 30
605,170
715.577
803,915
1,132,100
Aug. 30
699,340
829,697
983,685
1,331,240
sales
SERIES
—
U.
S.
DEPT.
729,795
848.825
OF
100):
Meat
1,310,500
and
240
227
217
436
438
303
353
190
_
20O
-
285
—
—
—
_
_
289
280
306
__
products
313
189
^358
335
/
—''
380
—
269
21T
75,000,000
$275,000,000
263,072,711
256,644,152
34,212
32,40*
$263,224,860
$263,106,924
$256,676,556
632,618
634,631
675,206
$262,592,241
—
175
263,185,643
_
2^T
39,217
—
181
$275,000,00{
products
Poultry and eggs.
394
277
animals
Dairy
$262,472,292
$256,001,347"
12,407,753
12,527,707
18,998,652
422
U. S. GOVT. STATUTORY DEBT LIMITATION
As
of
(000's omitted):
that may be outstanding
July 31
Total face
at
Total purchases
Short sales
715,130
Livestock
325,850
364,700
_
263
226
319
_
-
_
301
245
437
_
:
Oil-bearing crops
194,190
Aug. 30
Total ronnd-lot transactions for account of members—
293
270
_
grain and hay
Truck crops
18,900
175,290
101,300
112,700
INDEX
238
Fruit
184,850
11,400
sales
•
—
AGRICUL¬
—
_
Cotton
any
amount
time
Outstanding—
Total
public debt
Guaranteed obligations not
gross
owned
by
the
Treasury
Total gross
Commodity Group—
AH cemmodities
Sept. 16
_
Meats
All commodities other than farm and foods
_
111.3
*111.4
112.0
Sept. 16
Farm products
106.3
107.2
110.0
Sept. 16
110.0
110.3
16
112.9
113.7
116.4
—Sept. 16
112.7
112.6
112.7
public debt and guaranteed
obligations
Deduct—other outstanding public debt obli¬
110.8
I—Sept.
Clncludes 624,000 barrels of foreign crude runs
20,748,000
1941=100—As
Food grain
623,340
•Revised figure.
154,895
15,154.000
—
Crops
registered—
sales
foods
116,566
25,084,000
FARMERS
DEPT.
Tobacco
Processed
183
15:
149,010
NEW
230
910
OF MINES)—
1909-July,
Unadjusted—
All farm products
MEM¬
124,700
=
173
908
(barrels)
BY
NUMBER —U.
438,050
PRICES,
3,386
202
21,342,000
(BUREAU
mills
TURE—August,
85,530
LABOR—{1947-49
30,023
2,943
174
(barrels)
63,627
29,902
202
(tons)
(tons)
61,347
90%
412,860
WHOLESALE
1110,660
61,626
(at end of month—barrels)
72,510
Total
63,239
98,122
July:
336,350
Total
34
61,063
98,058
(barrels)
Aug. 30
Short
10,485
125,566
from
Aug. 30
Total
.
„
29,833
states)
Other sales
on
*28
61,342
(bushels)
crop
states)
sales
Other transactions initiated
9,939
6,120
7,571
28
(pounds)
Month
PRICES
Aug. 30
BERS. EXCEPT ODD-LOT DEALERS AND SPECIALISTS
Total
7,717
10,166
Capacity used
sales—
sales
Short
(tons)
seed
(SHARES):
sales
TRANSACTIONS
325,708
28,278
2,328.226
335,421
3,027
(5
Shipments
Stocks
YORK
Other sales
tMHJND-IDT
28,268
2,040,172
222,380
EXCHANGE AND ROUND-LOT STOCK TRANSACTIONS
VOB ACCOUNT
280.512
1,676,125
29,669
and
sugar
states)
Production
shares
3,763
264,395
1,172,300
337.685
PORTLAND CEMENT
purchases by dealers-
7,479
17,446
2,712
2,210,435
(tons)
Cranberries
4,831
15,812
275,929
(bushels)
Pecans
Sept.
490XAL ROUND-LOT STOCK
Pears
Grapes
32,035
1,188,225
(bushels)
6
Sept.
Short
Peaches
24,422
-—Sept.
(bushels)
commercial
706.004
12,563
42,937
30,054
5,590
(tons)
589.114
10,767
40,430
2,697
(tons)
489,697
108.461
11,083
15,529
(pounds)
Apples,
99.646
33,802
31,043
(bushels)
for
Broomcorn
14,735
159,265
15,144
\41,089
,
(bushels)
20,805
sales
I
beans
beets
Sugar
43,805
73,149
13,889
102,417
(pounds)
Sugarcane
21.410
45,368
72,377
(bushels)
(pounds)
17,991
sales
Total
for
254,668
15,759
29,665
46,218
bags)
Hay, clover and timothy (tons)
Hay, lespedeza (tons)
Beans, dry edible (100 pound bags)
Peas, dry field (100 pound bags)
Soybeans
218.047
15,759
30,685
(tons)—
17,471
Other
Number of
306,185
1,316,396
—
(tons)
470,226
Short
Round-lot
212,433
1,266,025
(tons)
6
sales
35,820
214,112
.
alfalfa
6
by dealers—
shares—Total
of
wild
Sept.
Sept.
sales
Number
all
Hay,
Sept.
sales
other
23,366
(bushels)
(bales)
Sept.
Customers'
Customers'
Dollar
342,005
21,593
'
221,138
grain,
Sept.
sales
shares—Total
of
Cotton
Hops
sales
Customers'
Number
18,965
sales)—
total sales
645,469
235,799
•
1,263,886
Sweetpotatoes
shares
purchases
987,474
235,705
(bushels)
(bushels)
pound
Tobacco
Number of
Number of orders—Customers'
(100
Potatoes
Number of
Odd-lot
2,941.423
1,298,389
1,062,590
3,185,237
(bushels)
Peanuts
EXCHANGE—SECURITIES EXCHANGE
COMMISSION:
Odd-lot sales by dealers (customers' purchases)—
Dollar value
3,135,639
1,298,295
1,062,590
Barley (bushels)
(bushels)
Hay,
43TOCK TRANSACTIONS FOR ODD-LOT ACCOUNT OF ODDLOT
AGRI¬
thousands):
,
spring
Flaxseed
100
=
OF
(in
1
Rye
3.36
INDEX—
PRICE
Sept.
"
Hay,
NATIONAL PAPERBOARD ASSOCIATION:
Orders received (tons)
Production
3.22
3.53
3.37
Sept. 13
INDEX
3.22
3.54
Sept. 23
Sept. 13
COMMODITY
DEPARTMENT
of
(bushels)
Sept. 23
Group
Industrials Group
REPORTING
(bushels)
Durum
Sept. 23
I
S.
CROP
—
(bushels)
spring
Oats
(tons
(bushels)
all
Sept. 23
—...
Group
Utilities
U.
CULTURE—As
2.83
2.88
stock at end of period
pounds)
BOARD
3.08
3.06
(tons of 2,000 pounds)
copper
2,000
Sept. 23
—
—
Baa
1B4»
2.75
,
Aaa
Aa
A.
Winter
U. S. Government Bonds
A
of
S.
gations not subject to debt limitation
Grand
Balance
under
(last week revise
d to 709,000 barrels).
total
face
amount
above
♦Revised
outstanding
of
authority
figure.
obligations,
issuable
Volume 176
Number 5154
The Commercial and Financial Chronicle
...
$65 Million Pennsylvania Turnpike Bonds Sold
ment
Two issues of
struction
of
32-mile
a
to the present
wide
of
all
bonds
pres¬
ently outstanding.
The
bonds
30
redeemed
days'
prior
no¬
publicly tice, at the option of the Commis¬
Sept. 22 by a nation¬ sion, as a whole, on
any date from
on
of
group
were
219
investment
any funds
available for that pur¬
in part, by
lot, from
banking firms headed jointly by pose and
Drexel & Co., B. J. Van
Ingen & monies in the sinking fund on any
Co., Inc.; Blyth & Co., Inc., and interest payment
date, in either
The First Boston
Corporation. The case not earlier than June 1, 1957.
issues consist of
Construction plans call for a
$15,000,000 2%%
1, 1970, and $50,- 32-mile,
four-lane toll express¬
bonds due June
1, way, to be known as the Delaware
3%
1982.
River Extension
The
current
offering brings
$276,500,000 the total
callable bonds
amount
issued
to
of
by the Au¬
terminus of the Pennsyl¬
Turnpike
near
King
of
Prussia, Pa., to a connection with
vania
U.
be
Bristol,
outstanding
the
the
sale
bonds
1952,, and
100%
Sept. 1,
by the
secured
are
pledge of tolls and
new
from
revenues
extension,
and above
over
the cost of operation and mainte¬
and
nance,
the
further secured by
are
pledge of tolls and
from
the
tem,
existing
revenues
Turnpike
sys¬
and
above
and
over
operation
maintenance,
Continued
S. Route 13 at
mile
priced at
are
and accrued interest from
the
of
bonds.
new
The
after
from
the
cost
of
running from the
eastern
thority, of which $267,799,000 will
point north of
a
Pa.,
and less than one
the Delaware River.
from
Ultimately
the
Delaware
ten-mile
Ohio,
extension
a
proposed
of
the
New
from
the
to
northeastern
New
border
of
the New Jersey Turn¬
over
pike, the Pennsylvania Turnpike
and the Ohio
Quoting from the wis¬
failed
Dooley, 'when one can
twenty story window
efficiency
a
comfortably at the tenth
—then I will seriously con¬
sider the possibility of a limited
.
collectivism.
this
be
to
done
in
in
conclusion, "to improve the qual¬
country,"
ity
medical
of
and
areas
says
Dr
certain
out
a
more
equitable distribution of doctors
and of hospital facilities. I do not
believe
experi¬
English
nationalized
with
ment
the
that
medicine
provides the answer to our prob¬
lems. Fortunately, economic pres¬
have not faced
sures
solve
intelligence
to
problems by evolution¬
our
methods
ary
the
have
we
with Brit¬
We have the time
ain's dilemma.
and
us
thus
and
medical
thesis
the
of
in
the
standard
medical
lowered
I
has
care
have
no
more
doubt than has your own country¬
man.
You live in a land which is
Pragmatism; the
the
avoid
ex¬
Why
did it fail?
First:
specialist group.
its
haste
the
was
scheme
that
and
the
lure
of
service
public affairs
be
must
old
the doc¬
God
prayer,
be
State."
fervent
the
that
grant
it
may
so.
Dorst's
Dr.
was
put
The
2l/z
masterly
years
since then
have
that
estimate
1950.
passed
confirmed
have
his
respects
summary
record in April
on
of
in
the
all
re¬
actions of my colleagues at home
to the Act of July 1948. They have
also
proved the truth of his pre¬
the
Lords
"We
We have arrived at
which
stage
dicted in
a
in
I
myself
pre¬
speech in the House of
October, 1946. I said:
about to embark upon a
are
great experiment in
medical
services,
in which
the
an
State
the
nation's
experiment
takes
a
much
greater part than it has ever done.
I
conceive
it
to
be
the
doctor's
duty to do his utmost to make the
experiment
to
him, in
succeed.
It will
the main, to
use
fall
this
instrument in the best interests of
the
public,
doctor,
an
but
there is, for the
duty—his
over-riding
duty to his patient.
fill
this
If he
can
ful¬
paramount duty through
this means, he will, but if he can¬
not it will be for the
the
of
efficiency shall
con¬
tinue."
That the experiment has largely
turn
the
tap
difficult
of
to
spending on;
it
turn
off.
In¬
be
brought about by developments
the profession, it cannot
dictated by the State.
ther uneconomy, a fact
which, my
time being so limited, I leave to
within
be
The
G.
baits
P.
dangled
was
vided
and
No
he to work in isolation.
"Health centres" were to be
pro¬
practice
group
was
to
be encouraged. Facilities for
post¬
graduate' instruction
increased.
pened?
this.
to
were
be
What has actually hap¬
The very
The
G.
P.
opposite of all
finds
himself
to
large extent side-tracked. He is
today
tually
been
ports),
in
sieve with
a
mesh.
used
a
forms
which
at
he
(they
unloads
institutions
upon
have
several
been
scores)
by
his
patients
specialists
and
know
big overlap of the
a
aspect of Britain's Na¬
Health
work
of
which
Service
the
the
G.
P.
doctor
the
and
Every
refers
case
the
to
State hospital when he could him¬
self diagnose and treat it, either
in
his
own
office
or
at
the
society
Herbert
"Injurious
to
before
destroy
the
new
500
years
ago,
their
in
men
"It
were
innova¬
vated greatly but quietly, and
by
degrees." Said Hippocrates, 2,000
ago,
"It is disgraceful in
art, and especially in medi¬
cine, to make much ado, create a
years
talk
spectacle,
indulge in much
then
and
accomplish
noth¬
In the
National Health Service,
much was attempted in too
time.
a
We doctors pleaded
for progress by evolution rather
than by revolution; we pleaded in
vain. Had two steps been taken,
and then a pause to look around
and consider the
next, the present
disaster might have been averted.
These
been the
two
steps might have
regionalization (and con¬
sequent
rationalization)
hospitals,
with
up"
the
sine
of
workers
ready
the
to
National
Health
Service, which had al¬
been
in
operation
tal.
The
scheme
new
was
based primarily upon the hospital
and not upon the family physician
G.
P.,
as
we
short in my country.
forgot
the
Newman,
Health
of
non
medical
The
situation
incident
in the
or
hospi¬
reminds
me
of
during World War I,
when the late Sir Almroth Wright
was
asked by the Director-Gen¬
Army Medical Serv¬
going. "It doesn't go," said
dictum
himself
call
of
a
him
for
The planners
Sir George
Ministry
of
official, that "the founda¬
public's
it
is
lastly, consider if
house
is
could
not
in
simplify
interest
cation
this
and
the
of
would
nation.
spell
80%
the
of
is
care
total
cost
absorbed
of
by the
hospitals.
Add the fact of the
long waiting lists at the hospitals,
both out and in patients, and the
consequent absenteeism involved,
and the expense of short circuit¬
are
periment
cine.
dict
It
in
causes
Nationalized
not
was
of
ex¬
Medi¬
difficult to pre¬
that domination
of medicine
by the State would lead to other
disasters
tioned.
than
The
those I
have
denigration
men¬
of
the
work of the G. P. has
sapped this
most important branch of practice
of its spirit of initiative and ad¬
The
venture.
aspirant has
young
expense,
Is
fere.
it
really necessary that,
check-up, the whole of
every
the
patient should be put on the
belt? Would not a big
part of the answer to the problem
conveyor
lie in
with
and
return to clinical medicine,
supplementary pathological
radiological data in selected
a
cases?
I wonder.
if
But
the
citizen falls for the
at
the
"Welfare
don't
least
State"
push
may,
ance
of the individual
to
Bwt
him
You
into
it_
by urging the import¬
induce
doctor
you
him.
save
him
to the
case
readily
more
believe in the value of the in¬
dividual
to society.
You may
able to convince him that:
b&
"As
the
power
of
the
State
grows
of the
some
Simplifi¬
less
clearly the bogey
frightening the public and en¬
couraging the politician to inter¬
the
energy
of
the
spirit
ing the G. P. and his normal func¬
These
you
is
not be able to
less
no
if
medical
care
in the patient's interest and in the
may
Service,
your owix
Think
order.
National
Health
cause,
yours.
dwindles; and if ever the
of the State should extend
activity
comfort
be
through
and through to every department
of
life, the universal ease and
that
thus
may
dis¬
seminated
throughout Society will
have been purchased dearly at the?
price of the soul.
that
clothed to
is
perfection; only—and it
drawback—they wilt
(G. Lowes Dickinson.)
serious
a
be
The denizens of
city will be fed, housed and
dead."
W. H. Hudson, in his account of
and
more
specialist and ancient Peru says that:
consultant
"In that State every man did
branches, encouraged
thereto still further by subsidies as he was
told; worked and rested,
and a spurious promise that they
got up and sat down, ate, drank,
were
in training for permanent and slept,
married, grew old and
therefore
been
attracted
to
more
the
jobs
in
these
fields.
Nemesis died in the precise way prescribed..
caught them: the permanent jobs And I daresay if he tried to- be
"Why, how's that?" were a mirage and, when the eco¬ original or to do
something out
said the Director-General.
"Well," nomic axe began to fall, some 500 of the common he was knocked
said Sir Almroth, "you send all
or
600 of the specialist trainees on the head."
the
doctors to France and you were dismissed from their
posts in
It is said that when Lenin had
bring all the wounded soldiers mid-career
and
recommended
ice
was
Sir
Almroth.
they
so
meet." Many
never
of the so-called
"cottage,"
G. P.
or
wards, take his part in the diag¬
nosis
and
and
treatment
his
resume
whilst
oversight
there
when
the patient returns home.
it or not) for
fighting forces!
(believe
with the
is
it
but
gloomy picture.
a
true
a
it
have but
I
one.
ready told you. For a while medi¬
has, in England, lost its Free¬
segregation of the G. P.
from his specialist colleagues has
Medicine's
alarmed
shall—recover
Health
the
even
Ministry
itself, for in
of
report is¬
a
sued for the year ended March 31
last year,
this paragraph
appears:
"The Service had tended to
centuate
the division of
ac¬
the pro¬
fession into specialists and general
practitioners in the
the
of de¬
process
hospitals;
it
and
would be dangerous if the division
rigidly
were
intellectual
branches
maintained
of
contacts
of
the
the
or
the
profession
two
were
diminished."
Third:
The
satisfaction
Health
third
cause
with
Service
the
has
of
dis¬
National
been
due
to
inadequate representation of doc¬
tors
the
on
mittees.
this
key boards and
way
respect,
been
that
many
exercised
and
more
nominated,
in
as
unlimited,
not
and
others,
and
in
such
a
laymen,
elected, are
care.
1
planning (save the mark!) would
have
put any business concern
action
general
friends
tell
the
to
bankrupt.
State
stand
parity
annual
of
my
that, in a consti¬
the State can never
Be this as it may,
has
up
first
Some
me
tutional sense,
go
its
at
meeting.
been
to
between
quite unable
the fantastic dis¬
budget
and
ex¬
final
draft
of
his
to
a
wise
old
hermit in whose?
not
to
that
asked
the
old
if
man
he
out in Russia.
said the
"Leave it with roe,"'
wiseacre, "and
tomorrow."
day.
"Yes,"
"you
can
Lenin
said
do
all
come
came
the
this
again*
the next
old
in
man,,,
Russia,
express
in
you
your
not lose your
visions
see
dreams.
the
the
He
thought the plan could be carried
fervent
but—no one will live there."
country
May I close by once more pla¬
Freedom. Yes,
and if I may, I am here to give giarizing myself?
"Your country
you some hints toward that end,
is a country of infinite
capacity
that you may not sell your birth¬
and of infinite ingenuity; let-tt
right. It is said that young men
Chicago
hope
will
and
old
An
old
men
man—no,
word better, an
new
dream
not
I like
country of infinite credulity."
"ageing"
claim another privi¬
lege, since "ripeness is all," he
may give warnings.
This I have
done. Can you avoid the blunder
we have made in England? I think
man,
many
But not by apathy, still
least of all
can.
you
less by dissension and
by personal animus.
Put Not Your Faith in Politicians
I
Dare
In
in
faith
give
first
the
few
hints?
not
your
of whatever
tradition.
even
and
cine
goes
Politicians
politicians go but medi¬
on
forever.
The first
ephemeral, the last is eternal.
Medicine
It
a
put
politicians,
come
are
you
place,
Stability is not with them,
party.
nor
Four: On the economic side the
of
must
I
stay to tell you now we can—and
it.
I am here in
they
more
in control of medical
out
nostrils.
The Minister's powers in
almost
have
com¬
his
I have; judgment he had much confidence.
expanded what Dr. Dorst has al¬
cine
prepared
proposed Bolshevik State he took
thinking that I have
You will be
painted
service
dom and Freedom is the breath of
This
since
1911.
Second:
qua
the doctor's office
are
ad¬
locally; and the addi¬
the
dependants of the
Insurance
had learned to
we
has been grossly interrupted.
Less and less do they see of each
other, whether in the home, in
the
of
grants-in-aid
ministered
tion
up.
More serious still, the
between doctor and
ago.
veloping
ing."
too
yet,
care,
every
great
as
set
been
And
the
than
more
of
the failure of Great Britain's
years,
is
cause
even
lure
tion becomes obvious.
four
solid front.
and
patient's home, costs the country
money. Actually, under our
more
medical
He spends much of his time
estimated
tional
re¬
large
very
is
economic
than
official
The
at
There
ac¬
"filter" (the word has
a
your acumen to consider.
the
attractive.
most
were
longer
before
that may coroe
enemy
broad
«
Thirdly, explain things clearly
to the public, i.e., to the patient,
and carry the public with your-
citizen
a
hospitals, have been closed to the
family doctor, so that he can no
longer follow his patient into the
Said
years ago,
for
traditions
that
patient, i.e.,, —the
public, to decide how long the
sacrifice
the
is
less than the
no
have become organized enough to
take their places."
Said Francis
short
dictions.
What now?
imposed;
deed, in turning it off there is in¬
evitably an element of still fur¬
home;
tions would follow the example of
time itself:
Which indeed inno¬
add
-
possibly
This integration
natural process and can only
Precipitancy,
the quack
quack in medicine.
it
not
were
between
State.
the quack,
Spencer, 100
its
Such
begin the new
"appointed day"
on
the
start.
to
of
settled
even
the
the
on
terms
tors
in
from
success
threatened
Welfare
I
upon
could
to pay 50% of the
dentures,
spectacles, wigs, etc., which were
formerly supplied free. It is easy
to
family physician,
hospital and the consultant-
eral how the
Precipitancy
good
of the
several
a
has
it is
an
the home of
pleasant sound¬
which
the
of
syn¬
any
with
country
been
now
the
be
of
masked under the
name
is
which is
care,
face
more
over
pay for and the National Health
Service is today splitting upon the
rock of economics. A
ceiling has
functions of the
patient, which
Bacon,
To
the
There
care.
medical
integration
years
inevitable centralization of power
ing
be¬
There is much less post-graduate
instruction
than
there
was
ten
that
and
been
Dorst
in
care
work
to
to
was
the
60%
Much
embarked
year.
was
little of the early his¬
tory of their diseases and nothing
periment has not "worked."
remains
led
was
hospital
have,
and stop
"Much
the
apotheosis of medical care, where¬
as there is, of
course, no apotheosis
who
Turnpike.
Its Failure in Britain
.
ill-equipped, it must
disparity of
a
first
public
"close
fall out of
the
at all of their domestic conditions.
No "health centers"
and
Socialized Medicine and
dom of Mr.
in
The
after
of statism.
penditure,
that
signing
western
12
page
the
than
exten¬
Jersey Turnpike, thereby provid¬
ing a modern express route ex¬
Jersey
is
or
a
sion will connect with
tending
service
is
"Welfare"
bonds due June
000,000
he
competent it has
the first surety of success; if he is
of
be
may
least
at
upon
medical
a
If
lieve
after payment
extension
327-mile long Penn¬
sylvania Turnpike,
offered
con¬
of
P.
fail."
banking firms.
bonds to¬
revenue
taling $65,000,000 to finance
tion
G.
ineffective
Financing of Delaware River Extension to existing 327-mile
Turnpike underwritten by nationwide syndicate of 219 invest¬
(1149)
I
is not
that you
is your trust, not theirs
in their hands. See
safe
preserve
Secondly,
your own
strive
it.
for
unity
in
ranks. The doctors' dis¬
unity is the politicians' opportun¬
ity.
Having defined your cause
olparlv
pine**
im
vnnr
ranks
and
be
said
that
you
are
also
a
42
The Commercial and Financial Chronicle
u:no)
Admiral Corp., Chicago,
■
Now
Securities
June 2 filed 41,669 shares
■
ft. |
■■■
'
'
'4-
a
in
Registration
each
This
two
will
offer
exchange
stock of Canadian Ad¬
expire
NEW ISSUE CALENDAR
Oct. 17. DealerStatement ef¬
on
(jointly); Blyth & Co., Inc., The First Boston Corp.;
Salomon Bros. & Hutzler (jointly); Shields & Co.
and Blair, Rollins & Co. Inc. (jointly); White, Weld &
Co. Bids
Tentatively scheduled to be received onand
fective June 19.
Allpark Finance Co., Inc.
$500,000 of 6% sinking fund convertible
10-year debenture notes due June 30, 1962; 29,180 shares
of 60-cent cumulative preferred stock
(no par); and
Aug. 28 filed
September 26, 1952
Texas.
(Blyth
Honolulu
(Calif.)
(10/28)
and the other half to the Dollar interests.
—To be
determined
(Bids
Washington Water Power Co
(Bids
tificates
and
for
cause
such
new
division
Read
Equip. Tr. Ctfs.
Chesapeake & Ohio Ry__
(EST)
noon
V'-'
Witter
(Dean
1
Co:y '< >
&
7, 1952
'
'
Francisco, Calif.;
i
?
Associated Telephone Co.,
(Bids
12:30 p.m. EST)
(Lids
Common
(Peter
&
Morgan
Stuart & Co.
-Common
...
Underwriter—Dillon, Read & Co. Inc., New York.
United Gas
Denver, Colo, f
(letter of notification) 158 shares of common
stock (par $5). Price—At the market
(approximately
$17,454 per share).
Proceeds—To E. J. Vogt, Trustee.
Sept. 17
Underwriter—Carl
H.
Pforzheimer
&
Co.,
New
York.
Associates
October
St. Louis,
Price—To
be
& Co.,
supplied
by
Inc.
(Bias
8,
:
\
May
&
Webster Securities
'
Corp..)
★
Common
each
Southern New England
Common
Telephone Co
$40
(Offered to stockholders—No underwriting)
White's Auto Stores, Inc
(Merrill
Lynch,
Fenner
&
Beane)-
of
10, 1952
(Bids
11
Bonds
(Bids noon EST)
capital.
Debentures
(Blair,
Rollins
&
Co.,
Underwriter—Parsons & Co., Inc.,
stock
20, 1952
ceeds
Carolina Power
& Light
(Bids
Co
noon
Bonds
EST)
October
(Bids
Cleveland, O.
(Bids
San
•
Underwriter—Walston, Hoffman & Goodwin,
stock
(par $1).
Proceeds
To retire two convertible preference stock
issues (5.50% and 5.60%) or for the
discharge of bank
loans, or both. Underwriters—To be determined by com¬
petitive bidding. Probable bidders: Merrill Lynch, Pierce,
Fenner & Beane and William R. Staats
Blyth &
Co.
Inc.; Lehman Brothers.
ceived up to 11:30
a.m.
(EST)
on
& Co. (jointly);
Bids—To
be
Oct. 7 at Bankers Trust
it California Oregon Power Co.
(10/8)
Sept. 18 filed 250,000 shares of common stock (par $20).
Price—To be supplied by amendment. Proceeds—For
repayment of bank loans and for new construction. Un¬
Blyth & Co., Inc., and The First Boston
Corp., both of New York.
—
and
dev
*
per share.
Pro¬
opment program.
17, N. Y.
New York.
Proceeds—For investment.
Underwriter—None.
(James)
Engineering Co.
Sept. 19 (letter of notification) 100,000 shares of con-vertible 5% preferred stock to be offered for subscrip¬
Class A & B
EST)
•.
share).;
Office—58*
Sutter St., San Francisco 4, Calif. Underwriter—None.
stockholders only. Price—At par ($2
general corporate purposes.
per
Proceeds—For
_...i:...___.Common
stockholders—No
:
underwriting)
15, 1952 V.
r
■.
.
(Bids
to
Invited)>
be
November
18,
;
195.Z*U:i::
*
V., -
Long Island Lighting Co._^---__^_V---------B«nds
fRiris
fn
IV
hp
WC
VJ .'«V■*'
JLUVJLVtjU/4
tr
,j
,
'
'
re¬
Co., New York.
derwriters
Price—50 cents
Detroit & Toledo Shore Line RR._ j^_:__;i_-Bonds
—
;
to
November
(10/7)
common
i( Dole
3, 1952
Dow Chemical Co
tOffering
California Electric Power Co.
market.
1952
a.m.
November
Francisco, Calif.
Sept. 8 filed 350,000 shares of
11
cent).
rehabilitation
Suite 839, 60 East 42nd St.. New York
^★Diversified Funds, Inc., Elizabeth, N. J.
Sept: 18 filed 2,000,000 shares of special stock. Price—At
Bonds
EST)
a.m.
one
For
—
tion by
(par $1). Price—At market (estimated at $13 per
share). Proceeds—To Henry C. Maginn, Executive VicePresident.
21, 1952
11
(par
—
Office
Underwriter—Gardner & Co.,
American President Lines, Ltd
stock
~
(Nev.)
-
Virginia Electric & Power Co..__
October 28,
Co., San Francisco, Calif.
Aug. 15 (letter of notification) 4,100 shares of common
Peak Uranium, Ltd.
April 7 (letter of notification) 600,000 shares of common
October
Underwriter
Calaveras Cement
,
Devil
Inc.)
—None.
Bingham-Herbrand Corp.
Sept. 4 (letter of notification) 5,000 shares of common
stock (par $1).
Price—At market (approximately $14
per share).
Proceeds—To E. E. Parsons, Jr., a director.
Offering—Expected before Oct. 15.
i.
mon
JRailway Exchange Bldg., Denver 2, Colo.
15, 1952
Seiberling Rubber Co
it Big Horn Powder River Corp., Denver, Colo.
Sept. 15 (letter of notification) 750,000 shares of com¬
—
Underwriter—None.
Deerpark Packing Co., Port Jervis, N. Y.
March 21 (letter of notification) 235,000 shares of com¬
mon stock (par 10 cents).
Price—$1.25 per share. ProTo renav RFC lonn
t4i n^o and for working
reduction of short-term
stock. Price—At par (10 cents per share). Proceeds
For drilling expenses and equipment. Office — 603
$250,000 of 4J/2% con-*
Price—At par-
of $60, $100, $500 and $1,000 each).'
working capital.
Office—2110 Central
St., Kansas City, Mo.
Bonds
invited)
Utah Power & Light Co__
October
:■
denominations
Proceedjs%For
Colifornia Oregon Power Co
be
per
I
Kansas City, Mo.
Sept.; 18: (letter of notification)
14, 1952
to
Price—
share to'
Underwriters
held; rights to expire Sept. 27.
to stockholders and $41.75
Chicago, 111.
(in
October
shares
share
vertible debenture notes due Oct. 1, 1962.
CST)
a.m.
six
per
Co.,. Chicago,
(letter of notification)
★ Crown Drug Co.,
Preferred
Seymour Water Co
Electric
under term*-
public>; Proceeds—To purchase building.
—Blunt/Ellis & Simmons and Swift, Henke & Co., both
____Preferred
.
Pierce,
October
Proceeds—For
notes payable.
Underwriters—
Goldman, Sachs & Co. and Merrill Lynch. Pierce, Fenner & Beane, both of New York.
Temporarily postponed.
Cook
Sept. 9
and Dean Witter & Co.)
Corp.
Houston, Tax.
14 filed $26,000,000 of interests in The Thrift Plan
employees of this company, together with 400.000
III. - ■
7,172 shares of common;
stock (par $25) being offered for subscription by stock-,
holders of record Sept. 16 at rate of one new share for
Eq. Tr. Ctfs.
Sierra Pacific Power Co.___
(Stone
*'
shares of capital stock (par $5) purchasable
'd the plan. Underwriter—None.
.Common
invited)
be
&
Inc., Chicago & New York. Offering—Ex¬
Xontinental rOil Co.,
I; -1
1952
First Boston
and
to
(Bids
amendment.
; '
:.
Brownsville & Mexico*Ry
Investment Co.
Aug. 27 filed $30,000,000 of debentures due Sept. 1, 1962.
EST)
a.m.
California Oregon Power Co
Associated Telephone Co.,
Ltd. (Calif.)
(10/7)
Sept. 5 filed $10,000,000 of first mortgage bonds, series
H, due Oct. 1, 1982. Purpose—To repay bank loans and
for property additions and improvements. Underwriters
--To be determined by competitive bidding.
Probable
bidders: Halsey, Stuart & Co. Inc.; Paine, Webber, Jack¬
son
& Curtis, and Stone & Webster Securities Corp.
(jointly); White, Weld & Co. and Kidder, Peabody &
Co. (jointly). Bids—Expected to be received up to 12:30
p.m. (EST) on or about Oct. 7.
11:30
for
(Blyth
• Argo Oil Corp.,
Debentures
Corp
(Bids
:*
pected some time next month.
(First Boston Corp.)
•
Anheuser-Busch, Inc. (10/1)
Sept. 11 filed $35,000,000 of debentures due Oct. 1, 1977.
Price—To be
supplied by amendment.
Proceeds—To
prepay outstanding bank loans and for expansion pro¬
-•
Aug. 1,1967 and $2,500,000 of 10-year convert¬
junior debentures due'Aug. 1, 1962. Price—To be
supplied by amendment.: Proceeds—To pay notes issued
to the Portsmouth Steel Corp.
Underwriter — Halsey,
,
Harnischfeger Corp.
•
ible
-„-......^..Common
Gulf Sulphur Corp.
'-'•
tures due
.
'?• .'i
EST)
11:30 a.m.
■
'Enquirerv.;fnc.• <, -V: **•>;; J
July 25 filed $3,500,000 of 15-year sinking fund deben¬
Cincinnati
Ltd._„_^-.>„__—_Bonds
California Electric Power Co„——1
San Francisco, Calif.
purposes.Underwriter—Shaw, Hooker & Co., San
rate
October
>
Sept.' 5 (letter of notification) 66,600 shares of capital •
stock (par $1> Priee —; Approximately $1.50 per share.;
Proceeds—For new mining equipment aqd other corpo¬
s
Works_.___-C:it->----«-iPreferred
San Jose Water
equally between the parties
certificates for such shares of stock to be
:'-u' '■>:■?* ?'•'
(Earham & Cleveland-')
Central Eureka Mining Co.,
v
Corp.-J-^i^i^^Cbihmoii:
Industrial Research
Peabody & Co. and Merrill Lynch,
,
j?'
•
...
.
Kidder,
Pierce,: Fenner & Beane (jointly); Equitable Securities
Corp.; Smith, Barney & Co. and Blyth & Co., Inc;;,
(jointly).
Bids—Tentatively scheduled to be received
up to noon (EST) on Oct. 20.
^
Co., Inc.)
&
C.
Probable
bidding.
competitive
by
"Halsey, Stuart & Co. Inc.; Lehman Brothers;,
Langley/. & Co. and The First Boston Corp.;
(jointly);
v
.Debentures
(Dillon,
determined
be
bidders:
W.
1, 1952
Anheuser-Busch, Inc.
issued.
gram.
Bonds
EST)
noon
October
tween the United States of America and the Dollar in¬
(EST) on Oct. 28. If no bid is re¬
ceived which at least equals the minimum price of $14,000,000, the trustee will surrender and deliver the cer¬
To
filed
17
1982.
EST)
a.m.
(10/20)
$20,000,000 of first mortgage bonds due
Proceeds—For new construction.
Underwriters—
Sept.
Common
11:30
Co., San Francisco, Calif.
Carolina Power & Light Co.
be invited)
to
Co
by competitive bidding.
a.m.
Witter &
$25). Price—To be supplied by
Offering—Expected today.
Bonds
(Territory of Hawaii)
Underwriters
Bids—-To
be received by The Riggs National Bank of Washington,
D. C., as trustee under a "Settlement Agreement" be¬
terests, up to 11
Common
Inc.)
Co.,
&
(Bids
American President Lines, Ltd.
Proceeds—To repay
stock,
amendment.)
loans and for construction program..
Aug. 29 filed 80,000 shares of cumulative preferred
Inc.)
Co.,
Freightways, Jnc
(Bids
Sept 4 filed 100,145 shares of class A stock (no par)
and 2,100,000 shares of class B stock (par $1). Proceeds
—One half to go to the Treasurer of the United States
&
September 30, 1952
Consolidated
Chemicals Corp.,
Portland, Ore.
Aug. 20 filed 450,000 shares of common stock (par one
cent). Price — $3 per share. Proceeds — To lease and
equip plant for manufacture of sodium perborate tetrahydrate and for working capital. Underwriter—Dobbs &
Co. and M. S. Gerber, Inc., both qf New York. Offering
—Expected today.
Water Service Co.
California
Underwriter—Dean
Herrick
scries G (par
Idaho Power
Metallic
14.
Co.)
&
Debentures & Common
(Barrett
debentures, C. K. Pistell & Co., Inc., New York; and for
preferred and common stock, none, with sales to be made
through Marion R. Allen, President.
Office—Houston,
Stanley
(Morgan
Southeastern Fund
shares of common stock (no par). Price—For
debentures, at face amount; for preferred stock, $10 per
share; and for common stock, $5 per share. Proceeds—
For additional
working capital. Underwriter — For
—
Oct.
Common
Socony-Vacuum Oil Co., Inc
22,347
American
'
Co.
Manager—Dempsey & Co., Chicago, 111.
•
.
★ California Oregon Power Co. (10/14)
Sept. 18 filed $7,000,000 first mortgage bonds due Oct. l,v
1982. Proceeds—To repay bank loans. Underwriters—To
be determined by competitive bidding. Probable bid-,
ders: Halsey, Stuart & Co. Inc., Smith, Barney & Co.,
Union Securities Corp. and Carl M. Loeb, Rhoades &
miral Corp., Ltd.,
for
.
ADDITIONS'
.prss,ssoe
III.
at rate of one share of Admiral stock
shares of Canadian Admiral stock held.
.
* INDICATES
of capital stock (par $1) being
offered in exchange for common
Thursday, September 25. 1352
■■
■
■
■
...
Pacific
Telephone & Telegraph Co.—
(Bids
8:30
p.m.
Debentures
PST)
December 15, 1952
New Orleans Public
(Bids
Service Inc
to
be
Bonds
New York
Boston
Invited)
Philadelphia
Pittsburgh
San Francisco
Private IVires to all
offices
<
Chicago
Cleveland
Volume 176
Number 5154
......
The Commercial and Financial
Chronicle
(1151)
ic Dow Chemical Co., Midland, Mich.
fc>ept 23 filed 625,QUO- shades of common
to
be
offered
scription by
at
rate
about
the
of
follows:
as
205,000
share
new
shares for
for
Glen Alden
(par $5)
420,000 shares for sub¬
About
stockholders of
common
one
(11/3)
scocK:
each
Oct. 21, 1952
record
40
shares
subscription
by
held, and
employees of
and its subsidiaries and afLi'iaCtu comThe offering will open Nov. 3 and close on Nov.
company
-paries.
•26.
.'rice—To
•For
general corporate purposes.
be
supplied
by
amendment.
Proceeds—
Underwriter—None.
'•
(par one cent). Price—12 cents per share.
Proceeds—To repay loan from Electronic
Devices, Inc.,
-and
for
new
equipment
and
working capital. Under¬
writer—Royal Securities Corp., New York.
Offering—
Now
being made.
'★ Electronic Micro-Ledger
Accounting Corp.
Sept. 17 (letter of notification) 299,900 snares of com•mon stock
(par 10 cents). Price—$1 per share. Proceeds
-—For building
equipment. Office—53 State St., Boston,
Mass.
Underwriter—Jackson & Co., Inc., Boston,
Excelsior Insurance Co. of New York
(letter of notification) 20,000 shares
Sept;: 6
stock
(par $6)
shares
Mass.
held
(with
at
of
ra.e
one
snare
payment date
than five years from first
620 shares of 5% preferred
more
and
stock
(par $100). Price—At par (the notes in denominations of $500 and
$1,000 each). Proceeds
To operate
small loans business and to
purchase conditional sales
contracts.
Office—612 Illinois
Bldg., Indianapolis, Ind.
Underwriter—None, but City Securities Corp., Indian¬
apolis, Ind., will act as agent.
■
—
Farm &
Home Loan & Discount
Co.,
Phoenix, Ariz.
'
-
Proceeds—To increase capital.
John J. Rhodes and James E.
tors of the two
companies."
-
Underwriters—
McNelis, officers and direc¬
★ Financial Industrial Fund,
Inc., Denver, Colo.
Sept. 22 filed 600,000 Financial Industrial Fund
Shares;
1,500 cumulative investment
certificates; and 15,000 sys¬
tematic investment certificates. Price—At
market.
Pro¬
ceeds—For
investment.
Underwriter—Investment
Corp., Denver, Colo.
vice
Sept.
Corp.,
Seattle, Wash.
notification) 24,950 shares
12
(letter of
(par $1). Price
Ser¬
—
$12
share.
per
of capital
Proceeds
For
—
Corpora¬
Wash. Un¬
Ave., Seattle 4,
Fair
9
filed
stock
Inc.,
Philadelphia,
100,000 shares of
stock
common
(par $1)
purchase
for the month in which payment is com¬
general funds.
Underwriter—
Proceeds—For
None.
* Foote Mineral Co., Philadelphia, Pa.
Sept. 19 filed $1,973,000 of convertible subordinate dedentures due Oct. 1,
1967, to be offered for subscription
by common stockholders at rate of $500 of debentures
>for
each
principal
66
shares
amount.
together with
of
stock.
common
Proceeds—From
funds
Price—100%
sale
of
of
debentures,
from
bank loans, for constiuction
plant, to enlarge ore mining
and concentrating plant, for retirement
of $200,000 term
note held
by insurance company, and for additional
working capital. Underwriter—Estabrook & Co., Boston,
of
new
Gyrodyne Co. of America, Inc.
Sept. 10 (letter of notification) 2,000 shares of class A
stock (par $1).
Price—$5 per share. Proceeds
—For working capital.
Office—Flowerfield, St. James,
L. I., N. Y. Underwriter—None. Of the
amount offered,
$5,000 may be used-as1-" payment for services and for
supplied^fc^-
made
throughofficers
and
to be
directors.
tAt Gynklyne/Cd. of America, Inc.
Sept 18"(letter of notification) 16,972 shares of Class A
common
stock
(par $1).
Price—$5 per share. .Pro¬
ceeds—For working capital.
Underwriter—None.
Haloid
Co., Rochester, N. Y.
Aug. 14 filed 47,183 shares of convertible preferred stock
(par $50), being offered for subscription
by common
stockholders at the rate of one
preferred share for each
four shares of common stock
held Sept.
to
10; with rights
expire Sept. 29.
Price—At par. Proceeds—To redeem
outstanding 8,500 shares of 4% cumulative preferred
•stock
(par $100) and for general corporate purposes.
Underwriter—The First Boston
Corp., New York.
(10/7)
Sept. 17 filed 150,000 shares of common stock (par $10).
Price—To be supplied by amendment.
Proceeds—To re¬
part of bank loans and for general corporate pur¬
Underwriter—The First Boston Corp., New York.
pay
poses.
^ Hilseweck Minerals Corp., Dallas and
Oklahoma City
Sept. 18 filed $1,500,000 of 20-year non-negotiable de¬
bentures due Aug. 1, 1972 and 139,920 shares of common
stock (par $1). Price—$960 per
$1,000 debenture, plus
common
stock subscription warrants for the
purchase
of
50
shares of
common
stock.
Proceeds
—
For
general
corporate purposes. Business—To engage in oil and gas
business. Underwriter—None.-
lithium
June
6
Maryland Mines Corp. '
filed 200,000 shares of common stock
(par $1).
market (on the San Francisco Stock Ex¬
change). Proceeds—To selling stockholder (Gwendolyn
MacBoyle Betchtold, as executrix of the last will and
Price—At
chemical
of
Francisco.
Pa.
employees pursuant to the terms
plan.
Price—$3 below the average
market price
pleted.
Calif.
•
Idaho
Errol
Bechtold,
deceased).
Office—San
Underwriter—None.
Co., Boise, Ida. (9/30)
Sept. 3 filed 225,000 shares of common stock (par $20).
Price—To be supplied by amendment. Proceeds—To re¬
pay
short-term loans and for property additions.
Under¬
writers—To be determined by competitive
bidding. Prob¬
able bidders: Bl.yth & Co., Inc. and Lazard Freres & Co.
(jointly); Kidder, Peabody & Co.
up
to 11:30
a.m.
(EST)
Bids—To be received
Sept. 30 at Bankers Trust Co..
on
46*Wall Street, New York 15, N. Y.
•
Industrial Research, Inc., Miami, Fla.
(10/1)
Aug. 27 (letter of notification) 200,000 shares of common
stock.
Price—At par ($1 per share).
Proceeds—To in¬
crease
working capital and for general corporate pur¬
Business—To
poses.
velop
provide research facilities and
ic International Aggregates Corp., Denver, Colo.
Sept. 18 (letter of notification) $150,000 of 6% deben¬
share). Proceeds—To Irene F. Marple,
direc¬
a
Underwriter—Stanley Pelz & Co., Inc., New York.
* G & W Laboratories, Inc., Jersey City, N. J.
Sept. 22 (letter of notification) 50,000 shares of common
stock (par $1). Price—$5
per share.
Proceeds—For pro¬
and
research).
expansion
(including experimentation
Business—To
in
engage
sale of drugs.
Office—587
N. J.
Underwriter—None.
manufacture
and
and
Summit Ave., Jersey
City 6,
ic Gate City Steel Works, Inc., Omaha, Neb.
Sept. 15 (letter of notification) $250,000 of 5%
sinking
fund debentures due
nominations
of
May 1, 1966. Price—At
$1,000 each),
Proceeds
—
(in de¬
par
For
working
capital. Office—11th and Seward Sts., Omaha. Neb. Un¬
derwriter—The First Trust Co. of
Lincoln, Neb.
•
General
Bronze
Aug. 28 filed
Corp.
43,576 shares
of which 28.576 shares
by
10
common
shares
are
stockholders
held
Sept.
18
of
common stock
(par $5),
being offered for subscription
at
rate
(rights
of
to
one
shares
pany's
Employees' Profit Sharing Plan
are
offered
to
the
share
expire
10,000
trustees
for
each
on^Oct.
of
and
the
6);
com¬
Trust; and
5.000 shares to directors and officers of the
company and
its subsidiaries.
Price—To stockholders
$14
Proceeds—For
&
per
share.
working capital and to finance inventories
and receivables.
nolds
seven
per
program.
Boston
Underwriters—For 28,576 shares, Rey¬
'
u '
Co., New York.
stock
common
common
one
stock¬
share
new
shares held; rights to expire Oct. 9. Price
share.
Proceeds!—To
finance
construction
Underwriters—Blyth & Co., Inc. and The First
Corp., both of New York.
McBee Co., Athens, Ohio
Aug. 8 (letter of notification) 2,500 shares of first pre¬
ferred stock, 5% series. Price—At
par ($100 per share).
Proceeds—For
Hawk &
working
Co., Athens, O.
capital.
Underwriter—Roy
E.
McCarthy (Glenn), Inc.
June 12 filed 10,000,000 snares of
common stock (par 25
Price—$2 per share. Proceeds — For drilling of
exploratory wells, acquisition of leases and for general
corporate purposes. Underwriter—B. V. Christie & Co.,
Houston, Tex. Dealer Relations Representative—George
cents).
A. Searight, 50 Broadway, New
York, N. Y.
WHitehall 3-2181. Offering—Date indefinite.
Telephone
McGraw (F. H.) Co., Hartford, Conn.
Sept. 10 (letter of notification) 5,000 shares of common
stock (par $2) and warrants to purchase 20,000 shares
of
common
of
one
stock at
share
and
$6 per share to be offered in units
warrants
to
purchase four additional
shares.
Price—$19.871/2 per share. Proceeds—To Clifford
Strike, the selling stockholder. Underwriter—Granber.y, Marache & Co., New York.
S.
Mineral
Exploration Corp., Ltd., Toronto Canada
2,000,000 shares of common stock, each
share to have attached an "A," "B" and "C" warrant,
each giving the holder the right to buy one additional
share for each two shares purchased in
two, three, or
five years, at $1, $2 and $3 per share, respectively. Price
—For 2,000,000 shares, $1 per share—Canadian.
Pro¬
ceeds—For exploration, development and acquisition dt
properties. Underwriter—Brewis & White, Ltd., Toronto,
July
filed
29
Canada.
Names of United States underwriters to be sup¬
plied by amendment.
Multiple Dome Oil Co., Salt Lake City, Utah
Sept. 8 (letter of notification) 150,000 shares of common
stock.
Price—At
share).
market
(approximately
cents
10
Proceeds—To George W. Snyder, President.
derwriter—Greenfield & Co., Inc.,
per
Un¬
New York.
^ National Reserve Insurance Co., Phoenix, Ariz.
Sept. 16 (letter of notification) not exceeding $300,000
certificates
of
of
evidence of
contributions to
dividend
be issued in accordance with the terms of
trust agree¬
a
These
Office—4016 N.W.
Underwriter—Barham
ture
certificates, in turn, will evidence preorganization subscription to not exceeding 214,285 shares
of capital stock (par $1) of the Fire Insurance Co. (to
be incorporated) at $1.40 per share. Proceeds—For or¬
ganizational expenses. Office — 502 E. Campbell Ave.,
Phoenix, Ariz. Underwriter—None.
^ Natural Storage Co., Inc., Kansas City, Kansas
certificates
due
29th
Street, Miami, Fla.
Cleveland, Coral Gables, Fla.
&
Oct.
1, 1962 (in denomination of
Price—At par.
Proceeds—To
$500 and $1,000 each).
purchase equipment and for balance due
writer—R. L. Hughes &
Iowa
Public
on
mill. Under¬
Co., Denver, Colo.
Service
Co.
Aug. 29 filed 150,122 shares
be offered for subscription
record Sept. 25 at the rate
eight shares held (with an
rights to expire on Oct. 14
of
by
of
common
stock (par $5) to
stockholders of
common
one
new
share for
each
oversubscription privilege);
Price—$21 per share
Pro¬
ceeds—To pay off
additions and
temporary bank loans and for property
improvements.
Underwriter—None.
it Kansas Oil Co., Inc., Frankfort, Kan.
Sept. 19 (letter of notification) 300,000 shares of com¬
mon stock
(par 10 cents).
Price—$1 per share.
Pro¬
ceeds—To acquire all capital stock of Jet Oil
Co. and
for working capital.
Address
c/o William Shaffe,
—
Frankfort, Kansas.
Underwriter—B. G. Phillips & Co.,
New York.
Knowles in
consideration of lease assignments and ser¬
par (10 cents per share). Proceeds—To
drill well. Office—139 No.
Virginia St., Reno, Nev. Un¬
vices. Price—At
derwriter—Charles
Sherwin.
notification)
of
$291,740
of
discount
Price—At par (in denominations of $1,006 each).
Proceeds—For working capital.
Office—11 So. 5th St.,
Kansas
City, Kan.
Underwriter—None.
Nevada
Mortgage & Investment Co.
Aug. 25 (letter of notification) 60,000 shares of common
stock (par $1) and 240,000 shares of preferred stock (par
$1)
to
be offered in
units
of
four
shares
of preferred
Price—$5 per unit.
Proceeds—For costs incident to organization and devel¬
opment of business in purchasing and making first and
second mortgage loans; and to exercise an option cover¬
ing sale of income property. Office—114 North Third St.,
Las Vegas, Nev.
Underwriter — Stone & Ybungberg,
stock and
San
one
share of
common
stock.
Francisco, Calif.
Pacific Western Oil
Corp.
Aug. 5 filed 100,000 shares of
common
stock
(par $4).
Getty, Presi¬
Price—At the market. Proceeds—To J. Paul
dent,
Underwriter
brokers
on
—
None,
sales
to
be
handled J&y.
'the New York Stock Exchange.
Paradise Valley Oil Co., Reno, Nev.
Aug. 20 filed 3,000,000 shares of capital stock. Price—
At par (10 cents per share). Proceeds—To drill six wells
on
subleased land and for other corporate purposes. Un¬
derwriter—None, with sales to be made on a commission
basis (selling commission is two cents
per share).
Of¬
fice—c/o Nevada Agency & Trust Co., Inc., Cheney
Bldg.,
139 N. Virginia St., Reno, Nev.
^ Perfect Circle Corp., Hagerstown, Ind.
Sept.
stock
$14
(letter of notification) 1,000 shares of capital
(par $2.50). Price—At the market (approximately
17
per
share). Proceeds—To Herman Teetor, the selling
stockholder.
Underwriter
—
A.
G.
Becker
Co.
&
Inc.,
Chicago, 111.
Pure Oil Co., Chicago, III.
July 17 filed 85,688 shares of common stock (no par)
being offered in exchange for 471,287 shares of Hickok
Oil Corp., class A common stock (par $1) at rate of one
Pure Oil share for each 5V2
upon
approval
Products
ir Last Frontier Oil Co., Inc.
Sept. 12 (letter of notification) 3,000,000 shares of com¬
mon stock,
of which 1,500,000 shares are to be issued
to George S. Reed, Mrs. Beatrice Merrill and Robert G.
(letter
10
bonds.
de¬
capable of being produced in South
Florida, the first of which is a wet-cell battery protec¬
Front Range Mines, Inc.,
Denver, Colo.
Sept. 3 (letter of notification) 125,000 shares of common
stock (par $1).
Price—At market (approximately 37%
motion
for each
products
tive device.
cents per
Long Island Lighting Co.
Sept. 3 filed 599,942 additional shares of
(no par) being offered for subscription by
holders of record Sept. 24 in the ratio of
Sept.
Power
Mass.
tor.
•
common
testament
Stores,
to be offered to certain
of
drilling 25 test wells and for other corporate purposes.
Underwriter—Peter Morgan & Co., New York.
Idaho
derwriter—None.
Sept.
cents).
Francisco, Calif.
Underwriter—None.
—$15.50
Sulphur Corp. (10/7-8)
filed 225,000 shares of common stock
(par 10
Price—$3 per share. Proceeds—To pay costs of
8
bank loans. Office—37 Drumm
St., San
t
general corporate purposes. Address—c/o The
tion Trust Co., 1004 Second
Food
Gulf
Sept.
★ Lawrence Warehouse Co., San Francisco, Calif.
Sept. 17 (letter of notification) 5,000 shares of common
(no par). Price—$40 per share. Proceeds—To pay
stock
ment.
★ Floseal
stock
stock
Harnischfeger Corp.
1,613,168 shares of class A common stock
(par 25 cents) and 2,744,034 shares of class B
common
stock (par 35
cents), the class A stock to be sold only to
policyholders of The Farm & Home Insurance Co. Price
—At par.
on Oct. 3. Members
cents for each share of Burns
deposited under plan.
Underwriter—None.
Georgeson & Co., New York, will assist the
company in
■
July 7 filed
•
will expire
will receive 25
eachfUnderwriter—None, sales
xor
an
ated notes to mature not
'
Offer
may receive cash at rate of
share
to
which they
would
capital
Family Finance, Inc., Indianapolis, Ind.
Sept. 9 (letter of notification) $150,000 of 5% subordin¬
'
Alden
entitled.
uecome
stock of Burns Bros. As an alternative
shares
Glen
of NASD
Bros,
latter
per
materials
of
oversubscription privilege);
•rights to expire on Sept. 30. Price—$10 per share. Pro¬
ceeds—To increase capital and
surplus. Office—Syra¬
cuse, N. Y. Underwriter—None.
interest
$8.63
common
of
Sepfc.16 (letter Of notification) 12,300 shares of class A
being offered for subscription by stock-kv* c°mmjon. Stock (par lj>l). Price—$5 per share. Proceeds
holders of record bent. 8
five
share for
holders
com-
stock
•mon
Co.
(letter of notification) 13,232 shares of capital
(no par) being offered in exchange share-for-
the exchange.
Electro-Components Corp. of America
Aug. 19 (letter of notification) 2,000,uuu snares of
■
Coal
Aug. 26
stock
43
Co.,
a
of
merger
Hickok shares, conditioned
of
Hickok
into
wholly-owned subsidiary
Co. Underwriter—None.
Pure
Oil
Pure
Oil
of
»
Safeway Stores,'Inc.
Sept. 12 filed 1,900 shares of 4% cumulative preferred
stcok (par $100) and 18,000 shares of common stock
(par
$5) to be issued to James A. Dick Investment Co. (for¬
merly The James A. Dick Co.) in exchange for invenContinued
on
page
44
44
The Commercial and Financial
(1152)
Continued
Sunshine Packing Corp.
from page 43
will
all
sell
Dick Company
a substantial part of these shares from
the New York Stock Exchange. Under¬
or
time to time on
(par 50 cents) of which the debentures and 400,000 shares
of stock are to be offered in units of $50 of debentures
San Jose Water
•
capacity of plant and for working capital.
Underwriter—Weber-Millican Co., New York. Offering
(Calif.)
Works
(10/1-3)
•
Sept. 8 (letter of notification) 5,000 shares of non-voting
common stock, series B
(no par). Price—$10 per share.
Proceeds—To acquire real estate and buildings, convert
Underwriter
Providence, R. I.
ably Hemphill, Noyes &
Tentatively postponed. -
Security Title & Guaranty Co., N. Y.
Aug. 22 (letter of notification) 32,000 shares of common
stock (par $1).
Price—At market (about $2 per share).
Proceeds—To Investors Funding Corp. of New York.
Underwriter—Dansker Brothers & Co., Inc., New York.
•
Sierra Pacific Power Co.
(10/8)
share
each
share for
one
each
for
12
six shares of preferred and
shares
of
stock;
common
rights
to
Price—To be supplied by amend¬
Proceeds—From sale of stock, plus proceeds from
rities Corp., New York,
Francisco, Calif.
and Dean Witter &
(par 10 cents) to be offered in units consisting of $9
principal amount of notes and two shares of common
Co., San
formation on corpora¬
Live Oak Counties, Texas.
ceeds—To drill three wells to test
Duval
in
leases
and
Thompson Trailer Corp., Pikesville, Md.
27 (letter of notification) $116,150 of 5% con¬
vertible debentures, first issue, due Sept. 1, 1962.
Price
Aug.
Denver, Colo.
Aug. 29 (letter of notification) 95,682 shares of common
stock (par $1) to be offered for subscription by stock¬
holders of record Sept. 3 at the rate of one new share for
each 19 shares held; rights to expire on Sept. 30. Price
—$2.25 per share. Proceeds—For increased production
at mine. Office—434 U. S. National Bank Building, Den¬
ver, Colo. Underwriter—None.
public. Price — 60 cents per share. Proceeds—For ex¬
ploration of oil and gas properties, and to drill a test
well. Underwriter—None, but offering to public will be
handled through brokers.
ic United Business Underwriters, Ltd.
Sept. 16 (letter of notification) 150,000 shares of common
stock (par $1) and $150,000 of 10-year registered coupon
debentures. Price—At par (the debentures in denomina¬
tions
finance building and
Price—To be supplied by
of
$500. and $1,000 each). Proceeds — To
construction projects. Office—305-7
Bldg., Salt Lake City, Utah. Underwriter —
$100,
Newhouse
Proceeds—For the
acquisition and develop¬
production, and the expansion and
improvement of refining, transportation and marketing
facilities.
Underwriter—Morgan Stanley & Co., New
Shreveport, La. (10/7)
sinking fund debentures due
1972.
Proceeds—To repay bank loans and for construc¬
tion program.
Underwriters—To be determined by com¬
petitive bidding.
Probable bidders: Halsey, Stuart &
Co. Inc.; The First Boston Corp., Harriman Ripley &
Co., Inc. and Goldman, Sachs & Co. (jointly); Morgan
Stanley & Co., White, Weld & Co. and Equitable Secu¬
rities Corp.
(jointly).
Bids—Tentatively expected to
United Gas Corp.,
Sept.
York.
Southeastern Fund, Columbia, S. C. (9/26-30)
Aug. 14 filed $500,000 of 10-year 6% subordinated sink¬
ing fund debentures (with common stock purchase war¬
rants attached) and 100,000 shares of common stock (par
$1) to be offered in units of a $100 debenture and 20
shares of stock. Price—To be supplied by amendment.
Proceeds
To redeem $53,500 outstanding 5y4% sub¬
filed $60,000,000
5
be received
at 11:30
(EST)
a.m.
—
ordinated convertible debentures and 10,000 shares of
6%% cumulative preferred stock (at $11 per share and
accrued
dividends), and for additional working capital.
Business—Financing retail sales of house trailers on con¬
&
Underwriter—Barrett
Herrick
Co., Inc., New York.
ic Southern New England Telephone Co. (10/8)
Sept. 22 filed 400,000 shares of capital stock to be offered
for subscription by stockholders of record Oct. 8 at rate
of
share
one
($25
for
each nine
shares
held.
Price—At
par
share). Proceeds—To repay $3,500,000 advances
Telephone & Telegraph Co. (owner of
960,296 shares, or 26.67%, of the voting stock of South¬
ern, and for property additions and improvements. Office
—New Haven, Conn. Underwriter—None.
per
from
American
Standard Oil Co. (Indiana)
Aug. 28 filed $139,647,200 of 30-year 3V8% debentures
due Oct. 1, 1982 (convertible on or before Oct.
1, 1962),
being offered for subscription by holders of capital stock
at the rate of $100 of debentures for each
stock held as of Sept. 17; rights to
11
shares of
expire about Oct. 6.
Price—100%.
bank
loans
Stanohnd
payable
Oil
to
Proceeds—To
of
retire
$50,000,000 of
1%%
company, $25,000,000 of 1.75% notes of
& Gas Co.. a wholly-owned
subsidiary
banks;
and
$6,500,000
of
2.75%
notes
of
Southern
Corp., a subsidiary substantially
by Standard, payable to banks. Any remainder
will be used for capital expenditures.
UnderwriterMorgan Stanley & Co., New York.
Oct. 7.
on
U. S. Airlines, Inc., Fort Lauderdale, Fla.
Aug. 4 (letter of notification) $210,000 of 7% convert¬
ible equipment trust certificates, series A, due Aug. 15,
1954. Price—At par (in units of $100 and $1,000 each).
Proceeds—For purchase of two aircraft. Underwriters—
John R. Kaufmann Co., Scherck, Richter Co. and Semple,
Jacobs & Co., Inc., all of St. Louis, Mo.; and Gearhart
& Otis, Inc., New York.
Utah Power &
Light Co. (10/14)
$10,000,000 of first mortgage bonds due
Aug.
14 filed
1982.
Proceeds—To repay bank loans and for new con¬
struction.
tive
Underwriters—To be determined
bidding.
Probable
bidders:
by competi¬
Stuart & Co.
Halsey,
Inc.; White, Weld & Co.; Lehman Brothers and BearStearns
&
Co.
(jointly);
The First Boston Corp.
and
Blyth & Co., Inc. (jointly); Union Securities Corp. and
Smith, Barney & Co. (jointly); Kidder, Peabody & Co.;
Salomon
Bros.
&
to be received up
Hutzler.
Bids—Tentatively scheduled
to noon (EST)
* Valentine Oil Co.,
on
Oct. 14.
Inc., Omaha, Neb.
per
Price—$2
Proceeds—For drilling and other expenses.
share.
Underwriter—None.
Pan-Am
Virginia Electric & Power Co.
at
rate
of
one
new
share
for
each
four
shares held.
crease
Price— $100 per share.
Proceeds—To in¬
equity capital to take care of increased business
and increased costs.
.Chicago 13, 111.
Office—4101
Ravenswood Avenue
Underwriter—None.
Sept.
gage
bonds,
series J,
Co.
Inc.;
(jointly);
&
1,
&
Webster
Co.
'
-Ck"'
and Wertheim
& Co.
Corp.;
Union
Securities
Securities Corp.; Salomon Bros. &
& Co.
1982. Proceeds—For
Probable bidders; Halsey, Stuart
Kuhn, Loeb
Stone
Oct.
Underwriters—To be determined
by competitive bidding.
&
due
(10/21)
and refunding mort¬
17 filed $20,000,000 of first
construction program.
Co., Chicago, III.
Aug. 27 (letter of notification) 2,367 shares., of common
stock (par $50) to be offered for
subscription by common
stockholders
common
Zenda Gold Mining
Co., Salt Lake City,
Utah
18 (letter of notification) 1,200,000 shares of com¬
mon stock (par 10 cents). Price—At market, but not less
than par value.
(Current quotation of the company a
stock on the Los Angeles Stock Exchange is seven cents
bid and nine cents offered, if $120,000 gross sales price is
received by the issue before all shares are sold, no
Aug
be offered). Proceeds — For Alaska
exploration and development, retire¬
capital. Office—30 Exchange
Place, Salt Lake City 1, Utah. Underwriter—Samuel B.
Franklin & Co. of Los Angeles, Calif.
further shares will
tin
placer leases,
and working
ment of debt,
Hutzler; White, Weld
Bids—To be received up to 11 a.m. (EST) on
21, at 11 Broad Street, New York, N. Y.
Prospective Offerings
Power &
Arkansas
Light Co.
t
,
Moses, President, announced that
the company expects to borrow additional money next.
Spring to finance its 1953 construction program, which,
it is estimated, will involve $29,500,000.
Aug. 7 C. Hamilton
Bemis Bro. Bag
Co.
A
Aug. 13 it was announced stockholders will
30 on increasing authorized indebtedness by
_
.
vote Sept.
issuance of
$14,000,000 notes.
Benson &
Hedges
Sept. 10, Joseph
F. Cullman, Jr.,
President, announced
proposed offering of common stock for subscription to
stockholders at rate of one new share for each 10 shares
proposed issue and sale of $3,000,000 of de¬
Underwriters—For stock: none, with Tobacco
& Allied Stocks, Inc. (owner of over 50% of present out¬
standing common stock) to buy any unsubscribed shares.
For debentures: Morgan Stanley & Co., New York. Of*
fering—Expected some time prior to end of 1952.
held, also
bentures.
Byrd Oil Corp., Dallas, Tex.
in the fall
5V2% first
mortgage (convertible) bonds on a pro rata basis for a
14-day
standby
(certain stockholders have waived
their rights). Proceeds—To repay bank loans and for
development and exploration expenses. Underwriters—•
Probably Dallas Rupe & Son, Dallas, Tex.; Carl M.
Loeb, Rhoades & Co., New York; and Straus, Blosser &
July 22 it was announced stockholders will
receive the right to subscribe for $1,700,000 of
McDowell, Chicago, 111.
Sept. 23 filed 75,000 shares of common stock.
'owned
Streeter-Amet
magazine. Un¬
statement filed
1952, covering a like offering of preferred and
shares was withdrawn Aug. 1, 1952.
publish new national picture
derwriter—None. An earlier registration
None.
oil
contracts.
* Wisdom Magazine, Inc., Beverly Hills, Calif.
Sept. 17 filed 6,600 shares of 5% cumulative preferred
stock (par $100) and 6,600 shares of common stock (par
July 14,
Ltd., Toronto, Canada
Torhio Oil Corp.,
rights to expire
sales
York.
ceeds—To
Inc. (9/26)
Sept. 5 filed 3,180,188 shares of capital stock (par $15)
to be offered for subscription by stockholders of record
Sept. 25 at rate of one new share for each 10 shares held;
ditional
equipment, for research and development and for work¬
ing capital. Underwriter—Graham, Ross & Co., Inc., New
$10) to be offered in units of one share of preferred and
one share of common
stock. Price—$110 per unit. Pro¬
units of $50 each). Proceeds—For working
Address—P. O. Box 356, Pikesville, Md. Under¬
Aug. 21 filed 300,000 shares of common stock (par $1) to
be offered first to stockholders and then to the general
Socony-Vacuum Oil Co.,
crude
Sayreville, N. J.
capital.
writer—None.
of
Organic Chemicals, Inc.,
Sept. 10 (letter of notification) 150,000 shares of common
stock (par $1). Price—$2 per share. Proceeds—For new
—At par (in
Silver Bell Mines Co.,
ment
Price—
Royalty Co.
Underwriter—Stanley Pelz & Co., Inc., New York.
York.
amendment.
together with one $9 note and
shares of Texhead
Royalty Co. above.)
Wilson
tion's
Oct. 14.
common
$20 per unit. Proceeds—For acquisition of oil and gas
royalties in the Williston Basin area.
Office—415 San ,
Jacinto Bldg., Houston 2, Texas.
Underwriter—Rotan,
Mosle & Moreland, Houston, Tex.
(See also Texhead
Ardmore, Okla.
Sept. 2 (letter of notification) 934,400 shares of common
stock (par one cent). Price—31V4 cents per share. Pro¬
Signal Mines, Ltd., Toronto, Canada
July 14 filed 300,000 shares of common stock. Price—
At par ($1 per share). Proceeds—For exploration, devel¬
opment, and mining expenses, and to reimburse Maurice
Schack, Secretary-Treasurer. Business—Quartzite min¬
ing. Underwriter — Northeastern Securities Co., New
on
of this company,
stock
two
Texo Oil Corp.,
1952, to be used to repay $1,100,000 bank loans and for
new construction.
Underwriter—Stone & Webster Secu¬
New York.
Houston, Texas
notes due
below.)
private sale of $1,500,000 first mortgage bonds in October,
Pierce, Fenner & Beane,
(letter of notification) $135,000 of 3% income.:
July, 1962, and 30,000 shares of common stock
July 17
and gas
Jacinto
Bldg., Houston 2, Texas. Underwriter—Rotan, Mosle &
Moreland, Houston, Tex. (See also Wilhead Royalty Co.
expire about Oct. 20.
ment.
rill Lynch,
—$20 per unit. Proceeds—For acquisition of oil
royalties in the southwest.
Office — 415 San
one
Underwriter—None.
Wilhead Royalty Co.,
Royalty Co., Houston, Texas
Texhead
Bldg., Denver, Colo.
* White's Auto Stores, Inc. (10/8)
Sept 18 filed 100,000 shares of cumulative convertible
preferred stock (par $25). Price — To be supplied by
amendment. Proceeds—To redeem 5% convertible pre¬
ferred stock and for working capital. Underwriter—Mer¬
Offering—
New York).
Co.
July 17 (letter of notification) $135,000 of 3% income
notes, due July, 1962, and 30,000 shares of common stock
(par 10 cents) to be offered in units consisting of $9
principal amount of notes and two shares of common
stock of this company, together with one $9 note and
two common shares of the Wilhead Royalty Co.
Price
Sept. 15 filed 26,775 shares of common stock (par $15)
to be offered for subscription by holders of preferred
and common stocks of record about Oct. 8 on the basis
of
(par 50
cents). Price—To be supplied by amendment. Proceeds—
buy property for oil prospecting. Office—Houston,
Tex. Underwriter—To be named by amendment (prob¬
Office—73 Bliss Road,
Kidder, Peabody & Co.,
—
Co.
2,500,000 shares of common stock
filed
4
June
bonds due
1982.
1,
^ Western Empire Oil Co., Denver, Colo.
Sept. 10 (letter of notification) 3,000,000 shares of com¬
mon stock. Price—At par (10 cents per share). Proceeds
—To drill and equip oil wells. Office — 222 Patterson
To
and for other corporate purposes.
Newport, R. I.
Ltd., Toronto, Canada
Oils,
Texas General Production
install recording equipment and cameras,
stages,
time this month.
some
Grass
(9/30)
Proceeds—To repay part of outstanding
bank loans. Underwriters—To be determined by com¬
petitive bidding. Probable bidders: Halsey, Stuart & Co.
Inc.; Blyth & Co., Inc., Smith, Barney & Co. and White,
Weld & Co. (jointly); W. C. Langley & Co. and The First
Boston Corp. (jointly); Union Securities Corp. and Leh¬
man Brothers (jointly).
Bids—To be received up to noon
(EST), Sept. 30, at Two Rector Street, New York, N. Y.
Oct.
Exchange at time of offering. Proceeds—For working
capital. Underwriter—F. W. MacDonald & Co., Inc., New
York.
Offering—Probably some time in October.
Inc., Newport, R. I.
Seacrest Productions,
Sweet
Thursday, September 25, 1952
filed $30,000,000 of first mortgage
27
Aug.
July 29 filed 375,000 shares of common stock (no par).
Price—To be related to quotation on the Toronto Stock
Francisco, Cal.
sound
increase
—Expected
filed 41,000 shares of cumulative convertible
preferred stock, series C (par $25). Price—To be supplied
by amendment. Proceeds—To pay off bank loans and for
construction. Underwriter — Dean Witter & Co., San
2
Sept.
Proceeds—
Price—$100 per unit.
and 20 shares of stock.
To
writer—None.
...
Washington Water Power Co.
July 3 filed $1,000,000 of 6% convertible debentures due
1972 (subordinate) and 450,000 shares of common stock
will and other
tories, fixtures, operating supplies, good
assets of Dick. It is anticipated that the
of Pennsylvania
Chronicle
Oct.
Gas & Elactrlc Corp.
reported company plans the sale this
Fall of about $5,500,000 first mortgage bonds.
Latest
bond financing
was
done privately in March, 1951
Central Hudson
March
4
it
was
through Kidder,
Central
Peabody & Co.
Maine Power Co.
announced company soon after March 1,
1953, intends to issue and sell $6,000,000 of first and
general mortgage bonds and sufficient common stock to
yield approximately $5,000,000 to refund the then out¬
standing short-term notes. Underwriters—To be deter¬
mined by competitive bidding. Probable bidder—(1) For
bonds, Halsey, Stuart & Co. Inc.; Coffin & Burr, Inc. and
Sept. 2 it was
The First Boston Corp.
Kidder. Peabodv
(jointly); Blyth & Co., Inc. and
Lynch, Pierce.
& Co. (jointly): Merrill
Number 5154
Volume 176
...
White, Weld & Co.
Fenner & Beane and
Co.,
&
Ripley
Inc.;
Peabody &
First Bos¬
Inc.
the
purchase from the company of $5,250,000 of equipment
trust certificates to be dated Oct. 15, 1952 and to mature
semi-annually from April 15, 1953 to Oct. 15, 1967, in¬
clusive.
Probable bidders: Halsey, Stuart & Co. Inc.;
Salomon Bros. & Hutzler.
Fall.
this
bonds
lar
to raise about
$28,000,00 later this year through the sale of additional
common stock, probably to its stockholders on a l-for-5
basis. Proceeds—For expansion program. Underwriter—
Sept. 11 it was reported company plans
None.
Kaiser-Frazer
Sept. 9 it
ket
Power Co.
announced that it is presently estimated
Connecticut Light &
was
approximately $11,000,000 of additional capital will
toe required during the latter half of 1952. Underwriter
—Putnam & Co., Hartford, Conn.
that
(9/30)
Freightways, Inc.
Consolidated
Aug. 26
applied to the Interstate Commerce
authority to issue and sell 100,000 addi¬
company
Commission for
Business—Sec¬
ond largest motor common carrier of general freight in
the United States. Underwriters—Blyth & Co., Inc., San
tional shares of common stock (par
Francisco, Calif., and associates.
in September.
—
soon
Corp.
Corp., will handle the financing, with Henry J.
major part or all of the issue,
whichever it may be.
Boston
Kansas
City Power & Ljght Co.
Sept. 15 company announced that it plans to issue and
sell
late
in
1952
$12,000,000
$5).
Offering—Expected late
★ Detroit & Toledo Shore Line RR. (11/15)
was announced that the company is planning
to issue and sell $3,000,000 first mortgage bonds due
1982. Proceeds
To refund approximately $3,000,000
toonds which mature on Jan. 1, 1953. Underwriters—To
be determined by competitive bidding. Probable bid¬
ders may include Halsey, Stuart & Co. Inc. Bids—Ex¬
pected to be received about Nov. 15.
Sept. 17 it
—
ic Duke Power Co.
Sept. 16 company announced that further construction
will later on require additional financing. There are,
however, no plans for raising any new capital at the
present time. Stockholders on Oct. 15 will vote on in¬
creasing authorized capital stock to 5,000,000 shares from
1,500,000 shares and on approving a 3-for-l stock
split.
& Co.
amount of
principal
Underwriters
competitive bidding.
—
first
To be determined by
Halsey, Stuart
Probable bidders:
Inc.; Glore, Forgan & Co.; Blyth & Co., Inc. and
Freres
&
Co.
(jointly); The First Boston
Corp.; White, Weld & Co. and Shields & Co. (jointly);
Smith, Barney & Co.; Kuhn, Loeb & Co.; Salomon Bros.
& Hutzler and Union Securities Corp. (jointly); Equit¬
able
Securities
Corp.;
Lehman Brothers
and Bear,
Stearns & Co. (jointly); Harriman Ripley & Co., Inc.
Lazzard
Proceeds—For
construction.
new
Long Island Lighting Co. (11/18)
Aug. 27 company announced its plan to issue and sell
$20,000,000
additional
Proceeds—For
construction program. Underwriters—To be determined
by competitive bidding. Probable bidders: Halsey, Stuart
mortgage "bonds.
& Co. Inc.; W. C. Langley & Co.; Smith, Barney & Co.;
Blyth & Co., Inc. and The First Boston Corp. (jointly).
Offering—Tentatively scheduled for sometime in Novem¬
ber.
company
Portland
which
&
Ogdensburg Ry. first mortgage 4^2% bonds
mature
Nov.
1, 1953. Offering
—
May be made
privately.
Mid South
Aug. 23 it
Gas
Co.
company has asked the FPC
authority to start work on a $7,000,000 expansion pro¬
An early decision is expected.
for
reported
was
by competitive bidding. Probable
bidders:
Blyth & Co., Inc. and Merrill Lynch, Pierce,
Fenner & Beane (jointly); Kuhn, Loeb & Co. and Smith,
Barney & Co. (jointly); The First Boston Corp.
determined
be
Eastern
Utilities
Associates
amended plant of reor¬
ganization of this company and subsidiaries calls for is¬
suance by company of $7,000,000 debentures and a suffi¬
Sept. 3 it was announced that
cient
of common stock to
amount
raise approximately
plan further provides that Blackstone Valley
Co., Brockton Edison Co., and Fall River
Electric Light Co. issue mortgage bonds. Proceeds—To
arepay bank loans.
Underwriters—For EUA debentures
anay be determined by competitive bidding.
Probable
bidders: Halsey, Stuart & Co. Inc. (for bonds only);
Lehman Brothers; Estabrook & Co. and Stone & Webster
Securities Corp. (jointly); Glore, Forgan & Co. and Haririman Ripley & Co., Inc. (jointly).
$2,000,000.
Gas & Electric
an
in the
14
it
reported
was
in November
sell
issue
company
plans to issue and
of
$8,000,000 first mortgage
bonds. Underwriters—To be determined by competitive
bidding. Probably bidders: Halsey, Stuart & Co. Inc.;
White, Weld & Co. and Kidder, Peabody & Co. (jointly);
Blyth & Co., Inc.; The First Boston Corp. and W. C.
Langley & Co. (jointly); Equitable Securities Corp. and
Shields & Co. (jointly); Merrill Lynch, Pierce, Fenner
& Beane; Union Securities Corp.
an
National Credit
Card, Inc., Portland, Ore.
Sept. 8 it was reported company is considering doing
some equity financing (probably in the form of class B
stock of $20 par value).
*
New Orleans Public Service
Inc.
(12/15)
July 24 company announced plans to issue and sell $6,000,000 of first mortgage bonds due Dec. 1, 1982. Pro¬
ceeds—For
new
to
ratio
common
offer
of
one
share
new
construction.
.
Telegraph Co., the parent, presently owns approxi¬
mately 90% of the outstanding common stock.
Price—
Proceeds—To repay construction loans and for
further expansion.
Pacific
Underwriter—None.
Telephone & Telegraph Co.
Underwriters—To be
de¬
termined
by competitive bidding.
Probable bidders:
Halsey, Stuart & Co. Inc.; Lehman Brothers; Kidder,
Peabody & Co. and Stone & Webster Securities Corp.
struction.
Underwriter—To be determined by competi¬
bidding. Probable bidders: Halsey, Stuart & Co-.
Inc.; Lehman Brothers and Union Securities Corp.
tive
(jointly); White, Weld & Co.; Morgan Stanley & Co. Bids
—Tentatively set to be received at 8:30 p.m. (PST) on
November 18.
★ St. Louis, Brownsville & Mexico Ry. (10/8)
Bids will be received by the company on Oct. 8 for the
purchase from it of $2,450,000 equipment trust certifi¬
cates due in l-to-10 years. Probable bidders: Halsey,
Stuart & Co. Inc.; Salomon Bros. & Hutzler.
/
San Diego Gas & Electric Co.
July 1, L. M. Klauber announced that of the more than
$18,000,000 required for capital improvements in 1952, ,1
approximately $4,000,000 will become available from de¬
preciation reserves and earned surplus, while the re¬
mainder must be secured through the sale of securities.
Underwriter—Blyth & Co., Inc. handled previous pre¬
ferred stock financing.
Sept. 3 it
(10/15)
announced that
was
for
and
working
capital.
scheduled for Sept. 25.
Co.
Inc., New York.
-
Registration
Underwriter
Hutzler.
4
Gulf Interstate Gas
Co., Houston, Tex.
Sept. 16 company applied to the FPC for authority to
construct an 860-mile pipeline extending from southern
Louisiana to a point in northeastern Kentucky. This
project would cost about $127,887,000. Transportation of
gas is expected to commence by Nov. 1, 1954.
*#
Hecht
18
Sept.
Co.
approved
stockholders
certain
wided the company
mnder
raises at least $3,500,000 of additional
Junior stock financing
capital.
.junior equity
consideration.
Underwriter—Goldman,
is now
Sachs
&
Sept.
it
15
was
additional
sell
to
that
announced
bonds
(Territory of Hawaii)
(9/30)
Sept. 11 it was announced that bids will be received on
Sept. 30 for the purchase of an issue of $6,600,000 school,
tunnel and flood control bonds to be dated Oct. 1, 1952
and to mature annually Oct. 1, 1953 to 1982, inclusive,
with
a
may
include
coupon
rate not to exceed 5%.
Halsey,
Stuart
&
Co.;
Probable bidders
The First Boston
Corp.
Idaho Power Co.
jr
tions; installation of a total of 73,600 h.p. in new and
existing compressor stations; and numerous branch line
additions. Probable bidders for debentures or bonds;
Halsey, Stuart & Co. Inc.; Blyth & Co., Inc.; The First
Boston Corp. and Kidder, Peabody & Co. (jointly). Com¬
mon stock financing will probably be done via rights.
•
Oklahoma
Metropolitan
Oil
&
Gas
Corp.
Sept. 10 it was announced that company plans some addi¬
tional common stock financing in about two or three
weeks.
Proceeds—For
acquisition of properties, work¬
capital and drilling expenses, etc. Underwriter—
Scott, Khoury, Brockman & Co., Inc.. New York.
securities in such amounts
as
Pacific Northwest
Pipeline Corp.
29 company filed a second substitute application
proposing to construct a 1,384-mile trans¬
mission line extending from the San Juan Basin in New
Mexico and Colorado to market areas in the Pacific
Northwest. Estimated overall capital cost of the project
Aug.
)
& Daly Corp., Boise, Ida., to purchase until
Dec. 31, 1952, up to 21,000 additional shares of 4% cumu¬
lative preferred stock at 100 and accrued dividends.
Financing is expected to consist of first
pipeline bonds, and preferred and common
is $179,000,000.
mortgage
expects
be appropriate at the
Halsey, Stuart & Co.
may
time. Probable bidders for bonds:
Inc.; Kuhn, Loeb & Co.; The First Boston Corp., Blyth
& Co. Inc. and Kidder, Peabody & Cq. (jointly). Any
stock
financing
may
be via stockholders.-
Southern
Ry.
Aug. 20 the ICC denied the application of this company
for permission to sell not exceeding $46,000,000 of new
bonds without complying with the usual competitive
rules. If offered competitively, the bidders may include
Halsey, Stuart & Co. Inc.; Kuhn, Loeb & Co.; Morgan
Stanley & Co. Proceeds—To meet in part the outstand¬
ing bond maturities of Southern Ry. and New Orleans
Terminal Co.
Southwestern Public Service Co.
tional
reported that company may do some addi¬
stock financing (with offer to be made
was
common
to
stockholders)
and use the proceeds toward its
it is estimated, will involve
approximately $23,000,000 for the year ended Aug. 31,
195£.
Additional bond
and
preferred stock financing,
may also be necessary; this previously was done pri¬
vately. Underwriter—Dillon, Read & Co. Inc., New York.
Shreveport, La.
Sept. 10 Electric Bond & Share Co. applied to SEC for
authority to offer for subscription by its stockholders
525,000 shares of common stock (par $10) of United Gas
Corp. on a 1-for-10 basis. Price—To be named later.
Proceeds
To Electric Bond & Share Co., which now
—
(owns
shares, 27.01%)
3,165,781
Gas stock.
of outstanding United
Underwriter—None.
United States Pipe Line Co.
(Del.)
Sept. 25, 1950 it was announced that this company
had
build, own and operate a petroleum
products pipeline from the Texas Gulf Coast to St. Louis,
Chicago and other midwest markets to operate as a
"common carrier."
The initial financing has been ar¬
been
formed
to
ranged for privately with no public offering expected,
for at least two years. E. Holley Poe and Paul Ryan, of
70 Pine St., New York, N. Y., are the principal officers
of the corporation. Underwriters—Probably Dillon, Read
& Co. Inc. and
if Pacific Associates, Inc.
Sept. 13 it was reported corporation plans to sell publicly
an issue of prior preference stock to finance expansion of
Kaar Engineering Corp. of Palo Alto, Calif.
with the FPC
Aug. 19 it was reported company has granted an option
to Wegener
Co., Omaha, Neb.
Sept. 17 company sought FPC authority to construct
pipeline facilities to cost an estimated $69,826,000. This
would include about 442 miles of main pipeline addi¬
company
permissible under its mortgage
indenture, and to provide for other permanent financing
by the sale of additional first mortgage bonds or other
United Gas Corp.,
Gas
the
during the first six months of
1953 in the amount then
Fenner & Beane.
ing
Co., New York.
Honolulu
Republic Co. (Inc.), Blyth & Co., Inc. and Merrill
amendments
vwhich would permit somewhat more long-term debt pro-
»
if Southern Natural Gas Co.
construction program which,
Natural
—
Tentatively
Blair, Rollins &
.
,
• Northern Indiana Public Service Co.
Sept. 18 it was reported company may issue and sell
shortly after the close of this year some additional pre¬
ferred and common stock. Underwriters—May be Cen¬
Northern
—
★ Seymour Water Co., Seymour, Knd. (10/10)
Bids will be received by the company up to 11 a.m.
(CST) on Oct. 10 at its office, 114 South Chestnut St.,
Seymour, Ind., for the purchase from it of 5,000 shares
of cumulative preferred stock (par $25). No proposal for
less than par and no dividend rate in excess of 6% will
first
•
plans to issue
publicly $3,750,000 of 15-year convertible sink¬
ing fund debentures. Proceeds—To repay $1,200,000 loan
Tentatively set for Dec. 15.
Lynch, Pierce,
company
and sell
capital. An issue of $200,000
recently placed privately at
$7.50 per share. Underwriter — Gearhart, Kinnard &
Otis, Inc., New York.
tral
(11/18)
Sept. 3 California P. U. Commission approved a proposal
authorizing the company to issue and sell $35,000,008
of debentures due Nov. 15, 1979.
Proceeds — For re¬
payment of advances and bank loans and for new con¬
Aug. 4 it
if Georgia & Florida RR.
■Sept. 22 company applied to ICC for authority to issue
«nd sell $717,000 equipment trust certificates. Probable
bidders: Halsey, Stuart & Co. Inc., Salomon Bros. &
shares of
&
(jointly); Equitable Securities Corp.; Union Securities
Corp. Registration — Expected about Nov. 14. Bids —
tional $400,000 of equity
of capital stock was just
nine
American Telephone
At par.
European American Airlines, Inc.
June 11 it was reported company plans to raise an addi¬
•
each
for
preferred stock held.
or
be considered.
Mississippi Power & Light Co.
March
company was
Seiberling Rubber Co.
sought ICC permission for authority to
issue and sell $1,500,000 of divisional lien bonds without
competitive bidding. Proceeds — Together with other
funds, will be used to retire the outstanding $1,676,000
Duquesne Light Co.
May
& Telegraph Co.
authorized by the California P. XL
for subscription by stockholders
additional 703,375 shares of common stock (par $100>
Maine Central RR.
Sept. 2
gram.
Sept. 10 it was reported that Philadelphia Co. is con¬
sidering plans to sell publicly about 200,000 shares of
common stock of
Duquesne Light Co.
Underwriters—
Pacific Telephone
Commission
preferred stock or debentures, to yield between $25,000,000 and $30,000,000. Proceeds—To repay bank loans, now
amounting to $22,000,000. Financial Adviser—The First
•
& Co., both of New York, and Dominion Securities Corp..
Ltd., Toronto, Canada.
Sept. 3
reported that company may come to mar¬
with an issue of common stock, or convertible
45
stocks, and is expected to be completed by April, 195&
Underwriters—Wfiite, Weld & Co. and Kidder, Peabody
The First Boston
was
mortgage bonds
March 1 it
Underwriters
Kaiser Co. purchasing a
Illuminating Co.
Electric
Development ("World Bank")
Sept. 3 it was announced Bank plans to issue and sell
between $50,000,000 of $75,000,000 in United States dol¬
Corp. and Morgan Stanley & Co., both of New York.
Chesapeake & Ohio Ry. (10/1)
Bids will be received up to noon (EST) on Oqt. 1 for
Cleveland
Bank for Reconstruction and
International
(jointly); Har& Hutzler.
Salomon Bros.
(2) For stock, Blyth & Co., Inc. and Kidder,
Co. (jointly); Coffin & Burr, Inc. and The
ton Corp. (jointly); Harriman Ripley & Co.,
riman
(1153)
Chronicle
The Commercial and Financial
Western
Glore, Forgan & Co., both of New York.
Natural Gas Co.
of an author¬
500,800 shares of preferred stock (par $30),
of which the company plans to offer about 170,000 shares
Sept. 2 stockholders approved the creation
ized issue of
as
convertible
of about 5%)
Proceeds—To
preferred stock (carrying a dividend rate
for subscription by common stockholders.
redeem 2,053 outstanding shares of 5%.
preferred stock
for
new
Weld
&
October.
(par
construction.
$100), to retire bank loans and
Traditional Underwriter—White,
Co., New York.
Offering—Expected early in
-
46
The Commercial and Financial Chronicle
(1154)
Continued from page
Dealer-Broker Investment
Also, contracts with industrial customers of
bad years.
very
one-half
least
Recommendations & Literature
Farms—Circular—Frederic
the
Title
Security
&
&
Hatch
H.
Co.,
Inc.,
the
Co.—Analysis—Gilchrist, Bliss & Co., 488
Madison Avenue, New York 22, N. Y.
Western Union—Addenda—Bruns, Nordeman & Co.,
But Indiana is
using original cost.
commission,
at this
issues
President Mitchell
but
The
60 Beaver
rates
to
absorb
must
ity.
estimates that,
Public
Utility Securities
it
a
good insurance policy.
14
page
inflation.
utility
electric
("Nipsco")
Company
is the
Bank
company
tect
able for distribution. Of this,
than
in
eight times as large as in 1935.
3.6%, was paid
4.2% was recapital additions. '
-
one-half,
or
dividends;
tained
operates in the highly industrialized area along
Indiana-Michigan border and the shore of Lake Michigan.
The area benefits by having excellent communications with other
The company
as
and
believe
not
do
I
the
can
one
any
sold, bank dividends should be increased.
unrealistic limitations and should
be adequate to give our economy
price he is willing to pay for bank real protection. It should be based
stocks. There can be no equitable upon the total nationwide bank
solution to the bank capital prob- asset loss experience of the past,
lem by reducing dividends.
•
the adequacy of our reserves to
meet
This
the company has had a heavy
program so that over half the plant has been built
decade. Since 1948 expenditures for construction have
averaged about $20 million a year and are expected to continue at
this level through 1954.
The capital structure as of recent date
as
(4)
Dec. 81, 1!>46
6,600,000
——
23,100,000
5,300,000
13,100,000
5,200,000
stock
Preferred
Preference
-
stock
Common stock
..
equity-—
Bankers
supervisors
•
Total
$100,000,000
further financing
$100,000,000
is contemplated until early 1953 when
preferred or common stock might be issued.
In 1942 the company was able to generate only 41% of its
requirements, the remainder being purchased under contract from
other utilities. However, two generating units of 70,000 kw. each
were installed in 1950-51, bringing total capacity
to 227,000 kw.
was
able to offset the lost industrial
residential
in
commercial
and
load
sales—the
by larger
steel
men
tax
when
new
supplies became available,
so
that
some
17,000
much
The company
trial
gas
this fall; there
has initiated
(dump gas)
business is
a
are over
the
following benefits from natural
from
23,000
new
The
in¬
Summer firm industrial sales—
gas sales
.v
by 1956
President Mitchell is not
depressions
on
period
"average
an
pe-
l^L°i^a,ntly rising prices:
and negligible losses. *
The
trained
the
gravity
justification for such
a
re-
in
field
the
of
bankera
use-,
fui understanding of our fiscal and
-/.
monetary policies.
:I
glad to
am
.
that the Ameri¬
say
Bankers Association is alert to
can
this
important matter. It has
the
nounced
establishment
an-,
of
a
Department of Monetary Policy to
give direction to banking thought
and action
in this
important
area,
of finance.
Bankers have made
in
ress
banks, \but
have
a<
how
the
works.
;
country's
debts, the
foreign aid, and
magnitudinous responsibil¬
terrific
-
the
been
and
increasing
It
pace.
average
cient
must
understanding of
economic
machinery,
This
ities/have
time
they
better
spending,
other
great prog¬
operation of their in¬
the
dividual
real
requires
at
a-
muclr
diligence for the'
acquire suffi¬
banker to
knowledge to keep himself
pro-
a
The present law
all
June 30, and
taxes
reduced, but it must be
through reduced spending
and the
of waste
elimination
duplication.
Many
students
and
of
You
men
safeguard
this
0f
here
the
today
depositor
You
country.
watchdogs for
our
banks.
help to
interests
are
the
new
out
curtailing
which
are
be done with-
can
the
expenditures
for
necessary
our
de-
fense effort.
There is
tion
a
one
where
area
in bank taxa¬
believe
I
we
problem.
could
It
t
realistic
reserve
To
assets.
do
ent law would be
$2,307,000
would
find
our
be
j'
more
risk
can
capital
through a
partial solution to
•
i
for losses in
this,
a
the
You
can
uate
effectiveness
the
information
*
in!
-
of tomorrow.
Leonard Refineries
you>
wen
as
Pfd. Placed
of bankers
The depositors count on
at work.
as
on
Leonard
bankers; and
the lawmakers look to both of
us
placed
O'Donnell
Nearly every bank supervisor I
have talked to has paramount in
his mind the need for additional
Privately
Refineries,
privately
for guidance,
has
C.
Mich.,
Inc.
through
R.
stock.
issue
an
,
&
of
Co.,
Detroit,
preferred
$500,000
,
.The
proceeds from the sale of
this
stock, together with other
bank capital.
You are in a key
funds, will be used toward the
position to speak out in favor of
company's
$2,000,000
expansion
a
constructive
solution.
It
is
not
program.
enough merely to say that we
need more capital. Generally you J
onnnnt pynpnt
crvlntinn thrnncfh
With Waddell & Reed'
T
o
cann°t expect a solution through
sale
additional
more
the
of
pres-
stock at present yields when so
Tou are rightly opposed to
1
"' "vIWCU UC IvCCU
(Special to The Financial Chronicle)
common
require^.%!5®«'^icb of it is selling below book
definitely be in
this
back, in perspective, and eval-
government, whom I respect, are
convinced this
of
•their communities.
Furthermore, such a backlog of
Entire staffs of officers and em¬
strength would do much to maintain public confidence in banks, ployees must be better trained.",
We need financial leadership now;
In such a period, the banker with
more
than
ever
before/
The
adequate capital would be in a
banker of today must acquire an
position to extend "emergency"
economic
understanding of our.
credit and thus sustain employmonetary and fiscal policies if he
ment and purchasing power,
is to be good enough for a banker
sit
income
terpreters
losses.
ST.
LOUIS, Mo. — Russell S.
Veryl L. Seaman have
Kribs and
become
&
associated
with
Waddell
Reed, Inc.
375 000
? $4,072,000
With S. R. Livingstone : ; *
■*
'
;
rection
as
for
it encoura
supervisors
to
criti.h
may be double those of
*
to
start
to
build
In. the company's
Tbe^^ti^gE»cflirtion
regulation, though, just
far
enough.
-
have
deposit
ition through reserves.
particularly worried about the effects
his electric earnings.
sensed
economics in order to attain
950 000
1951, increased storage at Joliet being helpful.
of future
of
level
done
440 000
—---V
j.l
that
of
liberal interpretation of
Increase in interruptible sales.____
It is estimated,
deterrent to
a
be
can
evi¬
in the coming 12 months
house-heating customers
was
it should not be extended.
time, and this type of
Economy from closing the South Bend gas plant
Total
than
capital investment that is es-
is due to expire next
(exclusive of normal growth):
Revenues
our
characteristics
its
economy
ductive economy.
Security Analysts estimated
gas
of
more
sential to the efficiency
growing rapidly. President Dean Mitchell in his recent
talk before the New York Society of
since
unnecessary
profits tax is
cess
the
10,000 additional applicants.
summer
profits
excess
thought possible at the outbreak
of the war in Korea. Also, an ex-
unique policy in selling firm indus¬
during the
existing condi-
has been able to retain
civilian
a
as
heating installations have now been made and another 5,000 will
be completed
have
the
which
reduction
present
seems
economy
dently use radio and TV more when they are unemployed. 1
The company has benefited considerbaly by receipt of natural
gas. Restrictions issued by the Public Service Commission of Indi¬
ana regarding
sales of gas for space heating were modified last
year
not
average
exception, serve
no
tax
Our
tions.
permitting the company to produce 57% of its greatly in¬
creased requirements. Much of the company's purchased power is
bought under contract from Chicago District Electric Generating
Corporation, the huge "wholesale" subsidiary of Commonwealth
Edison (both Commonwealth and Northern Indiana were at one
time part of the Insull system). While it is estimated that Nipsco's
peak load will increase to over 500,000 kw. in 1956 compared with
about 380,000 kw. this year, the company has no immediate plans
to add generators since more capacity remains available at the
Chicago District plants.
The company did not suffer during the recent steel strike,
creases
—certainly
an
great responsibil-
of the public under
and
since it
a
X
over
of the situation, and they are be-*
ginning to study the implications
then the adequacy should
be measured against a past period
bank
even
increas¬
around his bank. This wise old informed. Bankers must develop;
much
greater
economic "under-;
are in the public interest.
For ex- banker was very little worried
standing in order to help protect
ample,
the
excess
profits
tax when the depression struck as he
the value of their depositor's dol-,
against any business is, in my bad provided over a period of
lar and at the same time to be in-!
opinion, against the best interest years a means for meeting his
of
avenues
No
and
are
Bankers have
28,600,000
21,100,000
Every one
are'too high and
on
is clear, as it would allow
banks to take losses in depressed
ity for the welfare of our economy periods and continue to do busiand should not ask for anything n€ss as usual/. One of the wisest
which is not in the public interest.1 bankers I ever knew back in the
I believe, however, there are some '20s had reserves tucked away all
July 81, 15)52
—
disaster is to be based
of disaster—not
thinks all taxes
$47,800,000
debt
Other
of
Taxes.
Bank
duced.
$49,200,000
consideration
to
wishes that his taxes might be re¬
follows:
Mortgage debt
leads
a
the past,
the next point.
construction
is
total amount/however, should be
from its present
low,
Bank Taxes
becoming
of the importance of
loan assets, but for all newly de- in our economic course which af¬
fined risk assets which would in- fect our dollars. This is no short
elude government and municipal time project.
Young men with
bonds. The amount of addition to aptitude must be selected and
that the rate of return is
as
is indicated by the
agrees
too
in the past
compared with that of 1946
been
.
country
investor greatly increased
the
Certainly
is
aware
Representative, bankers
dividends
bank
house-heating.
With this tremendous growth
always
protecting the value of that dol¬
nation- this reserve should be limited for
wide should be reduced. In fact, any. one year and also limited in
if more common stock is to be the total cumulative amount. The
that
say
regions—rail, water and truck. However, industrial electric-gas
revenues are only 34% of the company's total and are quite well
diversified, steel being less than one-quarter of the total. New
plants have been built recently by Swift & Company, Gary Paper,
American Cyanamid, Keyes Fibre, Owens-Illinois Glass, etc.
Population growth in the area during the 1940-50 decade was
18% compared with the U. S. average of 14.5%. But growth has
not been concentrated in industry; since 1947 revenues from rural
sales gained 111% compared with 58% from industrial.
More¬
over, in the gas department house-heating and residential sales
have increased faster than the industrial sales despite restrictions
on
has
lar.
I do not mean a reserve for just
less
banker
ingly
Supervision and the
Bank Capital Problem
over-counter and it is also the largest
income is
It
responsibility to pro¬
the depositor's dollar.
Now
the
whose common stock is traded
utility in the state of Indi¬
ana.
Annual revenues (59% electric and 41% gas) approximate
$5-3 million compared with $52 million for Public Service of Indi¬
ana and
$32 million for Indianapolis Power & Light.
Nipsco's
growth has been remarkable, current revenues being nearly three
times as much as in 1940 and over four times the 1935 figure; net
largest
of
is definitely in the
reserve
a
I be¬
establishment
the banker's
from
Northern Indiana Public Service Company
Service
the
Any solution of the bank capir
problem will be only
temporary unless we hold the line
on
Public
that
talization
might be listed.
Continued
Indian
would
reserve
public interest.
By OWEN ELY
Northern
a
cushion of stability. It would
such
yet, but at some future
date
of
existence
a
lieve
President Mitchell does
as
sup¬
be
the present
rate of $1.52
the stock fully
seasoned
for
government
on
Our banks should be finan¬
be
recently around 25% to yield nearly 6%.
consider
in
cially strong enough to give neces¬
sary support in depressed periods.
compared with recent earnings of $2.22. The stock has been quoted
not
system
prepare
It should not be necessary to
port.
There are no
the dividend
on
capitalistic
our
banking
itself adequately
depend
increased costs in future.
68%—based
about
healthy
advance for its periods of advers¬
general, the company favors raising
any
of
The
economy.
element of fair
an
dividend policy is conservative,
company's
being
payout
In
time.
to the Survival
on
"fair
a
A
banking structure is fundamental
The
industrial
Street, New York 4, N. Y.
fects the whole nation.
been fixed for the company by
No rate base has yet
reproduction cost taken into account as
rate
banking business is a key
business, and what affects it af¬
Mr.
earned about 6.9%
value, the rate base would be well above book cost.
Company—Analysis — McDonald & Company,
Union Commerce Building, Cleveland 14, Ohio.
Stove
Tappan
estimate that the company
we
Indiana
with
Shattuck
G.
Frank
1951
value" state.
Company—Analysis—Lester, Ryons
Calif.
Insurance
Thus,
methods of
The
if one-half the industrial load were
even
the indicated rate base,
Co., 623 South Hope Street, Los Angeles 17,
requirements.
load
peak
present
proper
Banking—A Key Business
covering at
depression, net income would only be reduced about 8%.
a
In
Street, New York 5, N. Y.
Wall
63
lost in
considering
procedure.
credit of $750,000
a
Nipsco provide for minimum payments in bad years
Mitchell estimates that
Seabrook
which allows
Corp. there is a unique clause
in
in
the Chicago District Generating
contract with
purchase
power
8
Thursday, September 25, 1952
...
doe^t'gd' servants,
you
a
construe-;1
(Special .to The FiNanCjal Chbonicle)
DETROIT, ./Mich,
Miller
is
-r
connected
Harold
A./
with
to ofAs public
Livingstone, Crouse & Co!,
have an entree with
scot
the depositors and the-lawmakers
"
Penob^
Building, members of the De;
V?
troit Stock Exchange.'/
-
Volume 176
Number 5154
The Commercial and Financial Chronicle
...
(1155)
Continued
from
10
page
sight
Tomorrow's
NSTA Notes
ended in
First
four-way tie.
a
National
Bob
Over the
Bank, Jack Haggerty, Bosworth,
&
not time for
was
a
Co.,
Walter
Since there
play-off they drew for the winner
and Malcolm Roberts
rill
in with lows of 22.
came
came
up
with the prize.
out of
Orville Neely, Mer-
Calcutta:
tunate
The
following
Now
Meyer and Arthur Bosworth, Bosworth, Sullivan & Co.,
Longwell,
and
Company,
Jack
Ormsbee,
what
low
Hal Writer, Peters, Writer &
Julian
Christensen, Inc., Fred Carpenter,
Co., Chicago, 137.
Jr.,
Bob
Collins, 139.
Bob
Baker,
Hamilton
Management
Grocne,
Dallas;
Refsnes,
H.
L.
Ely,
Co.,
Beck
&
Chicago;
Stephenson,
Co.,
Dempsey,
Jamieson,
Co.,
Chicago;
Glore,
Phoenix;
George
Chase
Victor
Tcgeler
R.
Hutzler,
Wendt,
National
H.
and
Edde K. Hays,
cago;
&
The
Chicago;
John
Forgan
E.
&
Siefert,
Rauseher,
Co.,
Stern
Zahner.
Co.,
Los
The
Bank,
Bros.
Edward D.
First
National
Chicago;
Zahncr
and
Angeles;
&
Co.,
E.
Ray
Chicago;
Alien
Lord,
A.
Leonard
and
Co.,
Abbett
&
Higginson Corp.,
S.
Friedman,
Chicago;
Boettcher
Fred
Co., Chicago;
Wiltberger,
City;
Nourse,
The
Julian L.
&
Carpenter,
Co.,
John
Fred Carpenter,
Chicago; Edw. A.
Blyth
&
James F.
Pelz
Co.,
York
&
.
Co.,
Jacques,
W.
Soden,
I believe
sk
New
City;
Edwin
John
Illinois
Chicago;
Nuveen
John
Co.,
E.
&
Nuveen
Co.,
Inc.,
Krensky,
Chicago;
Chi¬
First Southwest
City;
Soden. Investment
Richard
Co.,
Corp.,
Walbert,
Kansas City;
Co!, Colorado Springs; William Wardman,
Fair^hild,
Dallas;
Lehman
A.
B.
First
Jack
Brothers,
Allen,
Chicago;
Harrlsberger,
Harris Upham & Co.,
about 270.
now
then look
participants who make
their decisions felt in the
ket
Stanley
Robt.
place.
tors has
Harris-Upham
issues
for storms.
out
cide.
that
a
will
In
probably be
61
York
6,
N.
*
1952.
October
10,
1952,
the
at
26,
1952.
of
The
Company will
JOHN
business
Chronicle.
pigeon-holed
under
ac¬
reasons
The
Board
September 23,
cents
close.
1952.
COLUMBUS
Common Dividend No.
A
25
BROAD
The
on
STREET,
Board
of
September
declared
Brown & Co.
INVESTING
the
no
par
American
record
of
24th,
record
15,
dend of
300
per
share
cn
an
York, September 17, 1952.
1952,
at
a
4,
N.
THE CHASE
THE
CITY
Or
BANK
NEW
YORK
at
i
1952
at
close
business
FRAHER,
DIVIDEND
NOTICE
Secretary
Sept. 17. 1932, the Board
declared regu¬
dividends on
Stock
Oct. 15,
GAS
1952,
New York 20, N.
he
as
follows:
Rate
Pay-
Y.
Per
5% Series
11-1-52
$1.25
of
directors
Fund Series
11-1-52
$1.25
One-Half Cents L.62 V2O
on the capital stock of
Company, payable on No¬
vember 17, 1952, to stockholders
Fund Series
E. E.
Vice President and
Cashier
$0.311/4
$0.31V4
1952.
cents
28
share
on
the
share
per
on
the
Stock;
cents
Preference
per
Stock, 4.48% Con¬
vertible Series;
share on the
Stock, 4.56% Con¬
cents per
vertible Series.
The above dividends
b. c. Reynolds,
are
pay¬
Checks will be mailed
from the Company's office in
Los Angeles, October 31,1952.
p.C.
DuVALL, Secretary
September 18, 1952
j
50
Common
1952.
11-1-52
$1.25 Series 11-1-52
of record at the close of business
October 15,
•
of the
following quarterly dividends:
able October 31,1952, to stock¬
holders of record October 5,
$25 par value
$1.25 Sinking
-
authorized the payment
28%
Preferred Stock,
two and
share
CTOCK
NO. 18
The Board of Directors has
Preference
5% Sinking
board
DIVIDEND
Share
$100 par value
this
the
payment of this
to
record
of
able
day declared a regular
quarterly cash dividend of Sixty-
per
this
Preferred Stock,
Dividend No. 19
Th
of
payable
corporation,
stockholders
COMPANY
I he transfer
books will not be closed
NO. 22
PREFERENCE
4.56% CONVERTIBLE SERIES
Common
of
30 Rockefeller Plaza
has
DIVIDEND
FINANCE CORPORATION
Date
the 7,400,000
ISO. 171
4.48% CONVERTIBLE SERIES
PACIFIC
CONSOLIDATED
extra divi¬
KENNETH C. BELL
Company
PREFERENCE CTOCK
holders of
to
the
NATURAL
3, 1952.
dividend.
California
Edison
COMMON DIVIDEND
Company
Special Meeting,
lar quarterly
the close of
.business October
in connection
with the
Southern
Y.
this
Preferred
capital stock of the Hank, both
payable November 1, 1952, to holders of
record
f
on
1952.
H. R. Fardwell, Treasurer
New
1952.
quarterly divi¬
shares of
OF
the close of business
Checks will be mailed.
NOTICE
50£ per share and
ROSS G. ALLEN
Secretary and Treasurer
payable Octo-
regu¬
dividend of one share of the
Common Stock
for
each
ten
$3.00 par value Common Stock
the
of
Chase National Hank of
the
City of
New York has
declared a
dend of
record
value
payable October 31,
Stock
October
I he
NATIOHAL
at
stock
a
par
shares
^
of
September 15, 1952.
value Common Stock
of Directors
DIVIDEND
October 1, 1952,
stockholders
1952, to stockholders of
October 3,
On
BANKING
has been declared,
on
Treasurer.
YORK
of
on
181
COMPANY
NEW
Directors
EDWARD
ftfORLDWE
share
dividend of $.50 per share on
books will remain
MOISE,
per
Stock of this
DIVIDENDS
CITY
J.
Bank of St.
Transfer
(31.25c)
the Preferred
open.
$5.00
Wilier, Boatmen's National
Directors
quarterly dividend of 25c per share on the
Common
Stock,
payable October
1,
1952
to
Stockholders of Record at the close of business
President—Richard H. Walsh,
Newhard, Cook & Co.
Vice-Presidents—Haworth F.
Hoch, McCourtney-Brecken-
D.
of
New
York
of
the
Preferred Stock
A
quarterly dividend of
thirty-one and one-quarter
COMPANY
ber 25,
MANUFACTURING COMPANY
and
West Streets
22,
on
ELEVATOR
lar
Security Trad¬
Treasurer—Ernest
NOTICES
or
NOTICES
Manufacturing Company has declared the
William J. Blake
Club of St. Louis to be
voted upon at their
annual election to
be held Oct. 30:
Louis.
as
of
Sep¬
GREENBURGH,
OTIS
the
Noble
Beckers, Paul
presented
are
Roofing Company
company
can
itemized
Brooklyn,
A.
an%
of the
SOUTHERN STATES
Treasurer.
The market doesn't fur¬
AMERICAN
Secretary—Walter
those
author^only.]
DIVIDEND
payable
market
of
DIVIDEND
Co., and William
necessarily at
with
They
those of the
Dividend
transfer books
not
G.
has been declared,
&
not
per
stockholders
to
close
*
causes
for any phenomenon,
though there are times when
it does reflect,
through fore¬
ridge & Co., Ralph
Moberly, I. M. Simon
Blake, Fusz, Schmelzle & Co.
do
payable
looking ahead in
nish
ers
taxes, hot
Y.
1G,
A dividend of
fifty (50<£) cents
share
has
been
declared,
of the
of
New
September
record
tion.
has been presented
to the
as
COMPANY"
COPPER
Broadway,
tember
classification
following slate
financial sui¬
sure
coincide
Iron
NOTICES
trying to outguess the other
be
The
too expen¬
straight customei
reaction
guy-
Moberly
and
SAVANNAH. GEORCIA
MIAMI
mar¬
.Yet, most of the above
M.
horse
Even floor traders
era.
Such items
article
time
to
Ralph
the
is
passed
activity in isolated
DIVIDEND
little niche in this
a
business
Colorado Springs.
some
Each of these fac¬
*
Haworth F. Hoch
with
has
(members of the N. Y. Stock
the rail
averages the picture
would be a
rally to about 103
with
market
SECURITY TRADERS CLUB OF ST. LOUIS
Richard H.Walsh
that
a
These have to
Corp.,
Chicago;
Trading for fractions
practice
slow rise will
carry to mention
commissions, may
them to about 273-275 to be
cost as much as a full
point.
followed by a new reaction.
So
[The views expressed in thU
long as the reaction doesn't
least, have be
swings of the
Co., Chicago;
Germain,
a
should
at
politics, economics,
foreign policy and foreign
trade, just to mention a few.
Surmounting all these are the
hopes and fears of millions of
Chicago;
Boston
umn.
Exchange) find it
si:
The (now about 99) with
intra-day
do
Lee Higginson
RepubliGrlhvestment
Paul
equally glib
answer.
stock market.
Bros.
Ray
Co.,
&
are
immediate connection with
the
Hecht,
Meyer, Salomon
be
the surface
on
&
C.
could
Mc., Wilmington, Del.:
however, is all wound potential to about 96. Within
with other matters that, that framework there
A.
Nuveen
how
furnishing the
up
Cij)., Wichita; Carl Oilman,
Chicago;
and
re¬
I
no
Chicago;
Henry E. Dahlberg, Dahlberg and Co., Tucson; Reginald O.
Dunhill,
Corp., Chicago; Duane T. Smith, The Small, Milburn
Lee
*
si:
num¬
*
I'm flattered
you like the col¬
buggy
a
up a
answer,
Pierce
Refsnes,
Kansas
Brinker, John
Kansas
L.
Central Republic Co., Chicago;
Joseph
any great
❖
dustrials
I
McGrew, The Northern
Bank,
Robert
Co.,
Clifton
Rauscher,
Chicago;
Hav¬
stock
a
W. J.
But to get back to the what- sive. For a
now-department. The Dow in¬ it is almost
the
glibly
in
"
Soule,
become
throw the question around.
were:
Taylor, Taylor & Company, Beverly Hills;
Trust
since
notice
wish I
Dempsey and Co.,
James
cold.
of
before, and
shucks,
grew
not
much
so
point of the current
You
'
.
Corp.,
Mitton, Robt. Mitton Investments, Malcolm Roberts, Sidlo.
Linus F.
Co.,
one
one
They're all
now.
.
news
question, now as al¬
is what to expect from break 268 the market, in my
here on.
opinion, will be okay. If it
*
*
*
does get under that
figure,
,,
Out-of-town guests of the event
that
by
minor ad¬
ways,
Simons, Roberts & Co., 140.
&
is
suggested re-entry at
has
*
Owen, Peters, Writer & Christensen, Inc., Jack Ralston,
Jerry Peters,
-
that
The
Peters, Writer & Christensen, Inc., 139.
Ft.
has
cession, is also to the good.
/
John
of
Meyer, Salomon Bros. & Hutzler, Chicago, Jim Powell,
1.38.
where
market
such stocks.
be little
to
such
usually leaves me
ing two shares
good. The fact that the
column
Lawrence, Boettcher and Company, Tom Dines, U. S.
John Nuveen &
All
to the
National Bank, 136.
1
a
Frankly
up and sighs of may be desirable for
again becoming aud¬ ber of reasons.
are
ible.
Boettcher
split usually have
let
relief
Peters, Writer & Christensen, Inc., 135.
Dave
have
to
134.
Elmer
the
about
are
exception to the rule. Two-
couple of points the is seldom a sign of great man¬ away
of bearishness seems agerial acumen,
although it
pressure
owners:
Fred
that
At least most
news.
that
an
three weeks
ago I mentioned
gone up a
the winning teams and the for-
are
good
vance.
By WALTER WHYTE
Lynch, Pierce, Fenner & Beane, walked off with the booby
prize.
;
Whyte
Says—
hat
a
ered
stocks
Delaney, Boettcher and Company and Malcolm Roberts, Sid-
lo, Simons, Roberts & Co., all
'
Sullivan
hindsight, certain
changes. A stock
split, for example, is consid¬
Markets
four players, Neil King,
course
or
corporate
47
Secretary
hale,
September 19,1952
s
ST
Treasurer
The Commercial and Financial
48
Chronicle
Thursday, September 25, 1952
...
(1156)
the
ratio of loan to collateral for
BUSINESS BUZZ
lowest income
producer.
its purpose in lower¬
FHA says
Washington...
$2,000 was to "discour¬
house by
age"
higher cost
"encourage"
of
construction
houses and thereby to
Behind-the-Sctne Interpretation*
And You
Capital
from the Nation's
more
the
to
should
who
rush to the
tion which
in
of the lower cost houses for
of
scene
conflagra¬
a
pretation from the nation's Capital
and may or may not coincide with
the "Chronicle's" own views.)-
one
propa¬
of
form
the
ganda mill? None other than the
staff of the Congressional Joint
of
reorganization
a
+ *
(This column is intended to re¬
Secretary Sawyer's heart, and
that he means to achieve in
to
accidentally broke out
of
number
the
maximum
the
spreading
families,
around so as to boost
flect the "behind the scene" inter-
project is said to be dear
This
income
money
housing units buiii.
a
projects to forestall a depression.
hats
Administration's
the
of
dun¬
of the
Department and
big
Fire
Volunteer
blue
the
don
the
and
garees
multitude
multi-billion-dollar make work
himself with
concern
C. —Now
D.
to build
the construction industry
lower
WASHINGTON,
limit per
ing the maximum loan
Department before
the Commerce
obviously would
much of the ini¬
port whose chief is Dr. Grover tiative from the Council of Eco¬
W. Ensley.
nomic Advisers and other groups
Seems about a month ago the of
planners, and so would be
Committee
Statistics
Labor
Bureau
of
leased
report which
a
threaten to take
re¬
resisted.
inter¬
was
It
retires.
he
Economic Re¬
the
on
if
Even
Mr. Sawyer were able
preted by the press to state that
to
during 1950 American families on
make it in fact the
the average spent
between
$400 more than
they earned. Horrors, what with
Truman and Stevenson telling the
world
Off
that
however,
So Chief Ensley
slid down the
ROTC and the
The
please
assistant
it isn't so.
say
director
tical
standards
the
Budget
wrote
"Dear
to
Friends of Dr.
he
concerned
was
inconsistency
so.
only with the
BLS
the
At
figures
Consumer Credit Facts for Yon
in
somewhere
present
to hold the most powerful
President of the United Mine
office
the
in
land
—
the
ings figures of other agencies, par¬
ticularly the Commerce Depart¬
ment.
i
due
course.
Defense
Sawyer Seeks
-
biggest
Planning Power
ices
ministration
his
Ad¬
history.
Secretary
is
jurisdic¬
departmental
tion, in scope and merge it with
a .semi-official
business planning
bureau he aims to set up in his
Department before he retires Jan.
20 as Secretary.
Mr. Sawyer's idea of planning,
is
however,
with
variance
planning"
entirely
almost
it is
as
at
proposes
Secretary
Commerce
the
to do is to tie a reduced
a new Bureau of Pro¬
3UPA into
the
Commerce
3SHPA
new
The
Department.
ex-NPA
or
within
Distribution
and
duction
men
eveiy
dustrial
capacity,
con¬
possible
capacity to meet
including
the
war
a
tribute
the job of
how best to dis¬
the
great output
to see
fully
which the defense-expanded U. S.
industry
can
as
Sawyer's
official
difference
program
planned
Sawyer
would
between
and the present
economy
long
of
without being fired out
school. They do have to agree,
if
they
viewpoint
seeking
tion
of
industry and trade,
ideas from both produc¬
and
distribution
executives,
and Inducing them to put the
ideas
into
operation themselves. He
J&ofc
shooting
store powers,
economy
at
more
is
controls,
and direction of the
by government decree.
A second main difference is that
Mr. Sawyer's tools
private
industry.
can
to
it up for four
military commis¬
keep
take
would
As
the
jn
at
a
siump# Hence it was
tjme
a
when
of
gradu¬
ation—if the military calls them
and
spend
two
,
is
,
■_
„
,
.
played out, then the Presi,
.
release
dent
can
$200
million
'
.
.
the
remaining
means
cessor
any
much
will
wants thereof at
or
as
his
he
suc¬
can.
lad who is
deferred from the draft by reason
belonging to an ROTC unit
cannot
concentrate too
heavily
of
service
it would
Is Class Law
Another of the
signs that gov-
housing aids are becom-
a
consider-
Y.—
N.
York,
Bargaining
—
Trade
and
Economics
(Labor
Organizations
Union
—
Collective
—
Social Security)
Robert D. Leiter—Barnes &
—
Noble,
Inc., 105 Fifth Avenue, New York
3, N. Y.—Paper—$1.50.
Register of Defunct and Other
Companies
Book)
1952—Thomas
Co.
Skinner &.
Gresham
Ltd.,
(Publishers)
Year
Official
Exchange
the
from
(Removed
Stock
House, London, England and
■
.
.
middle-class
to
have to
111
.
.
insurable
loan
.
,.
.,
.
individual
per
panies in the American Economy
—
j10Uge
Of
course
already
than
other
have
are
this
far
little
Clyde Williams Phelps
mercial
things
been
more
step
which
enacted
A
Credit
—
Com¬
Balti¬
Company,
Md.—Paper.
more,
or
important
Com¬
Role of the Sales Finance
,
U1
.
Cloth—£1.
raise
Shipper's
Appraisal
of
Ex
in branding Parte 175—Ford K. Edwards—Na¬
government housing aids as class
Southern
tional Coal Association,
legislation. In particular there are Building, Washington 5, D. C.
ing strictly
class
legislation was
the down payment limits which,
the
other
day in connec-
contrary to historical credit prac-
tion with the suspension of Regu-
tice, in effect allow the greatest
offered
For
Large Appreciation
convertibles and such like,
upon
New
Problems
Labor
Unionism
rather than lower the maximum
decreed
FHA
ernment
that
as
or
years
to active duty.
This
Bank,
So if FHA were not intentionally Broadway, New York 6, N. Y.—
families
•
$100 million authoriza-
,
tion
active duty following their
Potential
WE SUGGEST
least
^ to
the extent he can't
hi^courses. Otherwise it is
out of
RIVERSIDE CEMENT CO.
college and into the Army,
CLASS B
Navy, or the Air Forces.
FIRM TRADING MARKETS
Easy-Come Dormitories
For those
colleges whose hous¬
the
money
comes
easy,
although in far too little volume
from their standpoint.
Once the
FOREIGN
SECURITIES
its
housing
of
cement
fast-growing Southern Cali¬
review of the Cement Indus¬
try available on request.
Available around
15
FOREIGN SECURITIES SPECIALISTS
demonstrate that
problem is defense.
Finance Agency.
(common) STOCK
producer
fornia.
a
P.ARL MARKS & P.O. INC,
can
aggravated, or draft-deferred ag¬
gravated, it can get a nice easy
loan from the Housing and Home
leading
Analysis of this Company and
vated,
university
A
in
ing problems are thereby aggra¬
Most announce¬
not ments of college housing programs
would be the
He
in
tablished
FHA loan was es1935 when building
haltin^
members of faculties.
on
sions
in
approaching the problem from the
134
for
housing
that
is
interested
be
and
students
at the bottom
they can pass their courses and
hang
at
produce.
chief
couple of days lately been
jnsurabie
ajso
are cur¬
so
Impressions of Western Europe
Dr. Marcus Nadler — The Han¬
This statutory limit of $16,000 Paper.
per
ing 3%.
scholastic ladder,
the
of
pass
One
lering
of one
i.,
These boys may be
The distribution end of that new
trying
clip
was
emergency.
Bureau would take up
the
getting these approvals, are pay-
they belong to ROTC units.
cause
years,
the nation's in¬
stant touch with
*eSS±
at
have
which
them.
Another up to 153,000
within this
keep in
bureau would
—
over
considerable
youngsters must
conducted rently eligible for deferment be¬
now
under the Truman Administration.
What
a
quantity).
total of 190,000
So far only
$100 million has able-sized house could be purare being
deferred because they been released for this particular chased for an FHA loan of $16,000
appear to be the brighter boys. endeavor, although under Title IV and
a cash down payment of
These 190,000 are those who have of the
Housing Act of 1950 there >$2,500. It was ample to take care
consistently had good marks, and is $300 million available. This re- of most middle-class families.
are
in
the
upper
quarter
of quires no direct appropriation by
with cost of housing increased
their class as seniors, or can pass
Congress. It is Harry Truman s to gQ
since 1935, it is practitests to demonstrate above-aver¬
give away at the stroke of a pen.
cajjy impossible for a middle-class
age ability. These 190,000 can be All new spending programs like
£amiiy house to be purchased for
deferred
for
college
training this get started slowly. The presmuch legg than $18)000. A prinwhether they are studying to be ent one has involved loan apcipie 0f FHA operation is that
landscape
painters,
doctors,
or provals so far only of $33,075,000
there mugt be no junior trustg if
agricultural engineers.
to provide dormitories for 10,154 a mortgage is insured under FHA.
"economic
official
<
Of the 343,000, a
planning to reduce the National
Production
Authority, which is
under
that
able
route that gripes
into
Commerce
The
that
before
passes
; \
5 r • "
Fringe Benefits: 1951 (The nonWalter L. Greene, the new FHA wage labor costs of doing busi¬
Commissioner, by administrative ness)—Chamber of Commerce of
regulation established a limit of the United States, Washington 6,
$14,000 on the amount of any D. C.—Paper—$1 (lower prices in
its
It is the ease of
agencies of the Truman
Administration
of
of
one
to colleges and universities.
this draft dodging
go on
a project which,
if it approaches
fruition, will threaten to provide
one
last inter-bureaucratic fight
among the
agree
number
Charles S. Sawyer is working on
lation X's terms on home morW
gages.*
mortgage which FHA will insure
for any one single-family house.
Federal rate at the time the deal Previously
the limit had been
headaches. Even the Serv¬ is closed. Those institutions of $16,000, established by statute.
Department
314
Superior Avenue, Cleveland 14,
Ohio—Paper—30c- (20c per copy
for 10 or more).
Workers!"
neighborhood of 343,000 draft-age
sav¬
University,
Reserve
Western
Research,
Business
of
—Bureau
"Just think—he may grow up
state that there is an ROTC unit
youngsters are escaping the won¬ attached to the institution.
'
:
derful opportunity to show those
Under the law the Federal govRussians aggression doesn't pay, : ernment will lend for a maximum
as
Harry Truman would put it, term of 40 years, the cost of the
BLS
has
prepared
a
public
for the reason that they are tak¬
project to be amortized over that
apology for its "statistical error"
ing higher education. The large period.
and this apology will be issued in
total of this figure is giving the
The interest rate is the going
allowed with the established
Y.—Paper—$1.75.
N.
will
Sammy
•
An
can
build a nice clean
pretty up-to-date dormitory in
Ensley said that which the boy can sleep.
Grover" aud said it wasn't
to
Labor, and the Consumer)—Jack
Taylor — Barnes & Noble, Inc.—
105 Fifth Avenue, New York 3,
Draft
college and have
legally escape the draft,
and chances are good old Uncle
he
so
of
Bureau
Government:
(Government Rela¬
Business,
Agriculture,
Introduction
tions
with an ROTC unit
him join up
statis¬
for
the
of
Send sonny to
and
Business
adopt
their own.
the set-up as
pole, wrote a letter to the Budget
to
government and business,
this
approach would
of next year were to
merce
would not do!
Bureau
department to
leading liaison
only stand up if the newly-elected
President and Secretary of Com¬
everybody was better
rule, that
Democratic
under
his
re-shuffle
50 BROAD STREET...NEW YORK 4, N. Y.
TEL. HANOVER 2-0050... TELETYPE: NY 1-971
LERNER & CO.
|
Investment Securities
10 Post Office
Square, Boston 9, Mass.
Telephone
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