Full text of Commercial and Financial Chronicle : September 3, 1942, Vol. 156, No. 4104, Section 1

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iSEP

41942

PUS. kDWis
UBRARY

Final

Edition

THURSDAY

••'-

7V- U.
vBeg.
Volume

Number 4104

156

New York, N. Y.,

-

In 2 Sections

i

Association

Thursday, September 3, 1942

Price 60 Cents

'What shall I do with railroad

se¬

curities, and why?' rather than to
go into a discussion of the railroad

industry,
"We

have

had

I

ities with

us

most

years;

100

for

almost 80

concerned, almost 90
have

we

had

industrial

B.

McGinnis

.

"know that I try to talk on rail¬
road securities as distinct from the

road

securities; otherwise they
a corporate house.
the '20's you had the intro¬

"In

railroad problem.
You won't hear
much about the railroad problem

duction

from me, becausfe it is being dis^
cussed by almost every one and has

of

been for the last ten years, and it
is of little benefit, in my opinion.

of

utility

dustrial bonds.

the

'20's,

somewhat

had

a

business

1930,

if

you

diversified

you were in the corporate business
and, likewise, if you were a cor¬
have some stocks selling porate
customer..
Nevertheless,
at 5 or 15'of railroads, or if you
the large, proportion of corporate
have bonds selling at 50 or 20 or
experts and the large proportion
even at 80, and you ask your fi¬
of corporate trade and the large
duciary or your broker, 'what proportion of corporate holdings

"If you

I

shall

with

do

stocks?' and he

those

bonds

and

then goes into

a

long discussion about the railroad
.industry as such, or its peculiar
advantages or disadvantages, or
what will happen to the railroads
after the war, you aren't satisfied
with that; you want a more direct
answer.
What you want, I be¬

particularly if, you have)
to hear somebody
'sell them for these reasons'

railroad

in

was

from

bonds

as

distinct

utility bonds and industrial

bonds.
"It

■'

*

is

we

easy

did in the *20's.

however, most of

rail men

maturities

of

and

yields.

Just

think back to 1928 and 1929, when
we

allowed bonds like Rock Island

of

4's

&

>

AND CONSTRUCTION

maturing securities

guaranteed issues.

.

.

There's

prised

day

.

Secretary

Morgenthau's
We

...

any

;

decision

to

were

expected

} near-par price at which the issues

refunding,

a

selling.

were

sur-

off

pay

( $662,000,000 Treasury- 2s and RFC %s, due Sept. 15 and
i respectively.

to

on

.

point in denying that most financiers

no

by

.

this

from

refunding of outstanding notes and
though that rumor is around, logic

or

Even

.

suggests it is ill-founded.

forward

look

the

Oct. 15,

despite

.

.

...

the

But

we

11 didn't get one because of these factors: (1) the size of the issues,
indicating

<

refunding

a

worth;

was

securities

to

indicating
after

(2)

the

would

transfer

their

redistribution

a

sale;

be

apparent

(3)

trouble

more

decision
into

funds

of

of

the

most

other

refunding

than

;

t

Now that the

„

the

to

sell

maturity

major

it makes sense.
The
Treasury 2s, although they didn't gain the
we hoped
foi^, didn't lose anything either.
Buying
these for refunding
was
a
riskless wager—a rare enough thing
and worth a gamble at any time.
;

holders of the RFCs

.

.

.

.

:(1)

the
in

sible.

.

12 months

In connection with

.

MANAGEMENT PROBLEMS
FINANCING and VALUATIONS

-

(2)

order

their values

or

to

so

is

keep the financing calendar

as

course,

smaller than in recent years.

of

tfie

office

pate

are

in

(Series E and F
the

in

(1)

Do

v **"

your

between

and

now

y

v

.

.

:

;

refunding in the

own

tax-exempt issue

ever

clean

as

pos¬

the

conference

world

that premiums

the

Committees

securities

mercial

promote

the

or

maturity date if

a

•

you

v

\

own

and

corny

working

are

nation-wide

government bonds.
Forums
in other years dealt with
this

financing

year

task

of

and

industry

center attention

raising

to

sale

as

lems- of

12

billions

of

such

prob¬
will
the

on

for

war

ways of combating infla¬
tion, Mr. Fleek indicated.
on

,

York

was

chosen

,

the

as

place of the meeting in order to
hold
an

travel

absolute

plained.
of

of

those

A .substantial

Association
the

attending to

minimum, it

was

ex¬

majority

members

lo¬

are

large financial centers

Eastern

seaboard, it was
stated, and delegates from other
sections

ness

visits to the East.

one

of the

smaller

v

INDEX

,

'";-

-

Page

Bank and Insurance Stocks.,.,.....

Calendar of New

798

Security Flotations 807

1-

Investment Trusts

.

j.'5 -i'

(Continued

,

on page

.

799

Municipal News and Notes»......... 796
Our Reporter on Governments..,

iv. 793

Railroad Securities

796)

797

Securities Salesman's Corner.
Tomorrow's Market

National Security Traders Association Election

—

....

799

Walter Whyte

Says V.......................

..

' 797

Uptown After 3..................... 798

Heeling At Chicago, III., Aug. 28-29
Featured in this Issue,

beginning

on page

THE

800.

CHASE

Investment

of EGYPT
Office

Head

against depreciation

Commercial

Cairo

1jCairo

No.

Register

Broaden your customer

Trust Issues

prior to maturity)

BANK

OF THE CITY OF NEW YORK

All

NATIONAL BANK

R. H. Johnson & Co.

service with Chase

Bought—Sold—Quoted
FULLY

PAID

RESERVE

CAPITAL

FUND

£3,000,000

.

correspondent

£3,000,000

,

Established 1927
INVESTMENT

San Francisco

64 Wall

V,

SECURITIES
6

Street, New York

BOSTON

and

Albany

King

■

Wilkes

Street,

William

E.

C.

all

Branches

in

principal

Towns

1

Buffalo

EGYPT

Barre

and

SUDAN

the

Milk Street

Boston

the

N. Y. Phone

in

Boston

,

facilities

MAY & GANNON
31

Williamsport

Pittsburgh

AGENCY

LONDON

7

PHILADELPHIA

Troy
1856

the

Victory

through which

dealers

bankers

open

Gamble again on a refunding of the larger maturities and
pick up these securities for short-term holding whenever your port¬
folio position and the market dictate.

guar¬

ENGINEERSand CONSTRUCTORS

NEW YORK

together

representatives
of
Federal Reserve District
Fund

an¬

Treasury
partici¬

804)

in value

52 WILLIAM STREET

The

that

.

market and buy what¬
close-to-par security you want sometime

loans.

the only

are

through

Chicago.

with

on

over

Association,

in

Thus, the policy'you, who own or want to own maturing issues,
should follow is:

BUY UNITED STATES

anteed

Established

dent
its

cated in the

follows:

as

will not be refunded but will be paid off

always—always admitting, of

as

these days are

WAR SAVINGS BONDS
bonds

of

Aug.

same

Sanderson&Porter
Chicago

announced

was

NATIONAL
REPORTS

Invest¬

Association

of the country will be
urged to combine the trip with one
of their regular periodical busi^
The big maturities will be refunded and "rights" will have
in

And yet if

page

on

five-day

the

28

.

The small-total notes and the guaranteeds coming due

next
cash

had taken the trouble to look

(Continued

America, it

.

What this writer hears is that the
program now
'

.

and

few 32nds

the Norfolk

Western 4's of '98.

we

the

on

as

Bankers

New

has been made,

move

the

tax-exempts, thus
immediately
of
the
Treasury

small

a

total

of

issue

the
feeling on the
part
intermediary deal now would confuse
September borrowing picture,
i V .' ;

that

the

holders

also

-

SURVEYS AND
v

to

1988

basis

ment

of

scheduled to

to

cannot

we

.

.

students not of railroad credit but

lieve,

QUICK ACTION ON DESIGN

coming in,
but, even so, the
One thing that
are

usual

officials

value

and

were

customers,; is
say,

The tax collections

.

than

the

states

In retrospect,

us

September

of

convention

(2)

enough to condemn
for studying railroad bonds as

us

in

year

annual

nouncement

and in¬

bonds

So that at the end

in

.

borrowing

this

established

se¬

not

were

larger

even

by John S. Fleek of Hayden,
Miller & Co. of Cleveland, Presi¬

curities.

Patrick

an

.

more

Therfore, 90% of all your
research and corporate securities
up to, say 1920 was in railroad se¬
curities, because it was the only
corporate security we had.
As a
result, of course, 90% of all your
corporate houses had to be in rail¬

have

course, and war bond sales should pick up;
financing this month should be tremendous.
the Treasury's announcement of
redemption of these securities does
not mean is that a
policy of eliminating "rights" has been definitely

years

years

we'll

of

long time—al¬

a

thing that the * Treasury's announcement of redemption
refunding of the maturing 2s and RFC 7/8s does mean

than

that

experts had anticipated.

secur¬

longer than we have had utility
securities; and, so far as bonds are
than

One

-

rather
is

;

railroad

War Finance Meeting

;

day-and-a-half "war finance
conference" in New York City on
Oct. 19 and 20 will take the place

what it will be.

or

i

Reporter On "Governments"

1

A

to what it has been

as

Copy

a

IBA Plus To Hold

in

Chicago, Patrick B. McGinnis, railroad securities
analyst, of Pflugfelder, Bamptori & Rust, New York City, declared
that holders of securities of railroads in reorganization or which have
recently emerged from receivership will be in a better long-term
position with respect to earnings than holders of issues of many
other roads which currently have *>or 'buy more for these reasons' or
high revenues.
"Some of you who have heard some otheic constructive sugges¬
me
before," Mr. McGinnis said, tion, such as 'sell those and buy
something else.' Therefore, prac¬
tically all I have to say is an at¬
tempt to answer that question,

Section I

OfficeJ

6. Pat.

P. B, McGinnis At HSTfl

Meeting Declares
Reorganized Rails Have Favorable Outlook 0m
Speaking at the election meeting of the National Security Traders

-

CAnal 6-2610

Phone—Hubbard

Member Federal Deposit Insurance

Corporation

8360

Teletype BS 568-569

H. Hentz & Co.
Actual

Member»

New

York

Stock

New

York

Curb

Exchange

Cotton

Trading Markets, always

Exchange
Exchange

New '. York

New

Board

Orleans
And

Inc.

Exchange,

Commodity
Chicago

of

Trade

Specialists in
by expert staff in

of INDIA, LIMITED
Bankers

Over-The - Counter

Kenya

1.:

Cotton Exchange

other

NATIONAL BANK

Securities• •>

Exchangee

Head

Office:

Exchange Bldg.

Kobbe, Gearhart & Co.
INCORPORATED

Members

BOSTON

-

CHICAGO

,

DETROIT

PITTSBURGH

GENEVA, SWITZERLAND




N.Y.

Security Dealers

45 Nassau Street
Tel. REctor 2-3600

Philadelphia
Boston

In

New York
Enterprise-6015
Enterprise

and

26,

In

Uganda

GUARANTEED

Bishopsgate,'
E.

C.

RAILROAD STOCKS

1250

India, Burma, Ceylon, Kenya
and

Aden

Subscribed

Paid-Up
Ass'n

Teletype N. Y. 1-576

Telephone:

Telephone:

.

Government

London,
Colony

NEW YORK

the

Colony

.

Branches

N. Y. Cotton

to

Reserve
The

Bank

banking

and

Zanzibar

Capital.
.£4,000,000
Capital .....£2,000,000
.£2,200,000
..

Fund......
conducts

and

Trusteeships
also

.

every

exchange

and

description

of

HART SMITH & CO.

business

Executorships

undertaken

■%£c.

Members
New

York

52 WILLIAM

Security Dealers Assn.
ST., N. Y.

Bell Teletype NY

HAnover 2-0980

RAILROAD STOCKS-BONDS

GUARANTEED

—

1-395
BO. Gr. 9-6400

UTevr

York

Montreal

Toronto

NEW YORK

Telephone

52 Broadway

N.Y.

1-1063

Teletype

Thursday, September 3, 1942

THE COMMERCIAL & FINANCIAL CHRONICLE

794

Potomac EMic Issue

WISH TO BUY

WE

Chile Government
6'«,< 60-63 Assd &

■

Of $5,000,080 Offered

Unassd

Three leading investment bank¬
firms, Kuhn, Loeb & Co.,
Smith, Barney & Co. and Blyth &
Co., Inc., comprised the syndicate
which offered Sept. 2 the new is¬
sue of $5,000,000 of Potomac Elec¬
tric Power Company 1st mortgage
;

Sterling Issues

ing

Mr. Donald B. Sherwood

of

Brazil

Great Britain &
Bids

Firm

IS NOW ASSOCIATED WITH

Request

on

OUR CHICAGO TRADING DEPARTMENT

BROS.

KATZ

/

if held to

Security Dealers Ass'n

debt of

Daggett

We Take Pleasure

$40,000,000 compares with
and plant
account
$96,839,972 on June 30:

Nelson & Co.)

With Us

a

Stifel, Nicolaus & Company

Exchange

New York City

INCORPORATED.

the

and

the

to

S. Gil-

breath, Jr., Detroit. Mr. Gilbreath,
who is Vice President of First of
Michigan Corporation, succeeds to
the unexpired term on the Board
of Francis F. Patton, Chicago, who
retired as a NASD Governor upon

appointment as Executive Man¬
ager of the Victory Fund Commit¬
tee 1 of the Seventh Federal Re¬
.

serve

Mr. Patton is on a

District.

G.

A.

from

absence

of

William

A.-

nounced that

1

the

Crane

the

a

R.

Stuart

Vice-President

rate; per

tial

the

annual

average

kilowatt hour to residen¬
has been reduced

customers

from

2.96 cents

year,

which is said to be among

a

firm

Carothers

be all

Carothers.

Glas &

The firm will have new offices at

Whitney

the tele¬
will remain

Building;
-

in

charge

of

lowest

charged by

pany

Co.

since

1932

electric com¬

any

<

their

joined

organization, <; Both

had been associated

Stuart & Co. which is discontinu¬

ing its investment business.

-

-

\

1936 to $32,746,039.

since

with Wm. R.

Net

proceeds to be received by
from the sale of this
issue
of
3y4s
will

$5,567,870, exclusive of
accrued interest and-after deduct¬

discounts

underwriting

ing

or

estimated

and

ex¬

initially to be¬
part of the company's gen¬
They

penses.

are

„

Ctay, Field, Willed

With Bade WmmW
the

Charles R. Gay, member of
New

Stock

York

Exchange,

Chairman of the
office, will enter the banking de-t
group's legislative committee.
partment in Chicago.
has

been

Ed¬

ward P. Field and Joseph F. Wixted will become

partners in Gude,
Co., 1 Wall Street,

Winmill

&

members

throp, Whitehouse & Co. will form
a new partnership to continue the
firm's

investment

ward,

is

Specialized Market
and

also

&

s

hydro-electric, and

Investment

Dealers

6s,

5s,

transmission

line

Members New

Utilities

32

1958

.A.Saxton&Co., Inc.
Y. 1
NY

WHltehall 4-4970
1-609




[I

York Security Dealers Ass'n

Board of Trade Bldg.

Broadway

Teletype

Direct

CHICAGO

YORK

DIgbv

Teletype

and

land,

230,000in" Mary¬

132,000-volt

over

interconnecting

110,000-volt

lines

extending

in

large part along the right-of-way
of the Pennsylvania RR.
111

■■ ■

Thomas

STRAUSS BROS.
NEW

70 FINE ST., N.

CnlCAGO;

NY

4-8840

1-833,

834

Harrison 2075
Teletype CG 129

private wire New York to Chicago

ILL.

,

P.

Newton

—

Frye, President of the Central Re¬
public Company of Chicago,, and
Marcy T. Weeks, of Chicago, were
elected
to
membership
in the

Exchange by the

Stock

Chicago

Governors,. it

of

was

an¬

;

,

Mr.

with

Concurrent

Frye's

■

election,
the
Central Republic
Company is the second member
corporation
to
be admitted tp
membership
in
the
Exchange
since adoption of the new rules
last month.
Mr. Frye, formerly
an
advisor to the Board of Gov¬
in

almost

business

securities

the

quarter of a century.
'
memberships have

a

other

Two

been

has been
for

of the Exchange,

ernors

officers of
pending

by

purchased

corporations
and
approval.

are

formal

—i———

—

,

1

' ; y.

*•

1

Mayer With N. Douglass
(Special

to

The Financial

;

Chronicle)

LOS ANGELES,

with

become
Brown

York

a

&

Banks,

the past

he

York

J.

Brady

partner

prior thereto

& Co. , Iri
officer of Las'
>
,

,

4

F. B.

Badgley Joins

(Special

Dean Witter & Co.
to The Financial Chronicle) ;
j

LOS ANGELES,
B.

CALIF.—Frank

Badgley has joined the Los An¬

geles office of Dean Witter & Co.,
South

634

Badgley

Spring

Street.

previously

was

Mir.

with

Blyth Sr. Co., Inc. and in the past

in

will

an

officer of E. H. Rollins &

Sons, Inc.

shortly

Vernon

C.

In The WAAC

Co., 71 Broadway, New

Mr.
on

Brady

will

Ex¬

act

as

the floor of the New

Exchange

Brown.

was an

well & .Co.

Edna

City, members of the New

alternate

and

Huntley

'

1

York and Philadelphia Stock

changes.

Co.

&

Boothe

was

1952

Cities

Southern

gener¬

Brady To Be Partner

19S2

:

Cgo. Exchange Members '

over a

»■

Consolidated Electric & Gas
"A" €s,

steam

of Baltimore

transmission

1946

Interstate Power

Staib, Mr. Eustis' part¬

R.

■■"■"•ivV

the

with

volt

1948

6s,

of Lee
ner.:

ating system of Consolidated Gas
Electric Light and Power Com¬

and

*/2

interchanged

pany

for

and will report

Miami, Florida, on September
for training.
The investment
business of Geo. Eustis & Co. will
continue under, the management
5th

,

Commonwealth Gas

5

51%

63%, respectively, of Prince
George's and Montgomery Coum
ties in Maryland.
Electric energy

business.

Community Water Service

of

the District

comprising

and

A

Air Corps

Army

CALIF.—Ralph
E. Mayer has become connected
Incorporated in 1896 in the Dis¬ with Nelson Douglass & Co., 51(>
trict of Columbia, the company
South Spring Street.
Mr. Maye^v
sqrves an area of about 628 square
was
recently ' "with
Laurence

terest.

Columbia and approximately

Statistical Service
6s,

in¬

accrued

with

together

miles,

of the New York Stock

Exchange, on Oct. 1.
All were
partners in Winthrop, Whitehouse
&
Co., which is dissolving on
Sept. 30.
It is not yet known
whether other partners of Win¬

Firm Will Continue

Board

D'Antoni

years

Corps:

nounced.

come

NEW

;oni & Co.

257

CINCINNATI, OHIO — George
Eustis has been commissioned a
Second-Lieutenant in the U, S.

the company

ORLEANS, LA. — B. S.:
eral funds and are to be used to
& Co., American Bank;
meet its normal working capital
William W. Miller, President,
Building, members of the New
Gavin L. Payne & Company, Inc.,
requirements and for plant ex¬
Orleans Stock Exchange, announce
Wolf Transferred To
pansion/ The latter is estimated
Indianapolis, has been approved'
that Stanley S. Carothers has be-;
as
a
member of NASD District
Harris Bank In Chicago come associated with their firm.- at $8,691,000 for 1942. In June of
Committee No. 8.
He succeeds G.
this year the company received
Paul
W.
Wolf, for
the past Mr. Carothers, who has been in
.William
Raffensperger, Raffens$3,000,000 from the sale of 30,OOC
business for the;
seven
years with the New York the investment
shares of its common stock.
perger, Hughes & Co., Inc.
office of Harris Trust & Savings past twenty-seven years, was for¬
The bonds of the
1977 series
merly a partner in Hyams, Glas &
Bank, is returning to the bank's
will be redeemable on or before
main office in Chicago.
Mr. Wolf, Carothers. He is President of the;
who has specialized in municipal Louisiana Investment Dealers' As¬ July 31, 1943 at 116, and there¬
and
for
the
past six after on a graduated scale down¬
bonds in the bank's] New York sociation

Which nominated Mr. Gilbreath.

PH

Eustis In Air

additional

commissions,

With B. S. D'Anions

Teletype

.

amount to

Stanley Carothers Is

2-2280

HAnover

1477

average

in the country. • The latest
adjustment'
was
a
reduction
Mason, Moran & Co. also an-1 amounting to $338,000, effective
nounce
that John C. Culbertson Feb. 1, 1941. Meanwhile, net prop¬
and
Franklin
G. ■ Emrick/have erty
additions
have
amounted

.

.

residential

the
rates

thereto was Vice-President
Buck & Co. ' ,

prior

cents this

to 2.43

and

&

York Plione

New

Phone

Locust

of Folds;

Hyams, Glas
Southern Louis¬

the remaining person¬

of Hyams,

firm

R. IStuart

partner in the dis¬
and G. Price Crane,
in

their

PhiUdfelphla /

Street,

Chestnut

1421
Phila.

in

1937

Since

Stuart has been President of Wm.

of

past six years.
Con¬
nected with -the new organization

333

William

has been elected

times after

and 4.41

Municipal Bond Department, Mr.

iana for the

will

that

announce

who has represented
&

Co., 135 South La Salle Street

were

taxes

partnership of Glas &
formed.
Partners of

was

formerly
solved

earned 6.72 times

taxes.

charges

before

firm are R. Jeremy Glas

new

new

est

their

The

Baird,

&

nership of Hyams, Glas & Carothers was terminated and on Sept.

Robert

-

on

0

CHICAGO, ILL.—Mason, Moran

LA.—It is an¬
Aug. 31 the part?

NEW ORLEANS,

Wisconsin Com-i typewriter number
V,
'pany; Milwaukee, are the other; No. 288;...
Governors of NASD District No'J
Chapman H. Hyams 3rd is pre¬
8,
Edward B. Hall, Harris, Hall
paring to enter the armed services
& Company, Chicago, was Chair¬
and Stanley S. Carothers has be¬
man of the Nominating Committee
come associated with B. S, D'AnW.

In the

ended June 30, 1942> for ex¬
ample, after giving effect to the
issuance of the $5,000,000 of new
bonds now offered publicly, inter¬

Of Mason, Moran & Go.

In New Orleans

nel

Fuller & Co., Chicago, and

Win. R. Stuart V.-P.

Glas & Crane Formed

Incorporated.
Fuller,
William- A-.

Becker & Company,

H. N. NASH&CO.

a

earnings

of

Common

2039, Pfd. &

3-6s

year

Indiana, Iowa, Michigan, Nebraska;
and
Wisconsin
(District No. 8),

leave

show

time

same

margin

Transportation Co.

Phila.

return

for interest and dividends.

ILL. —Members of
the National Association of Se¬
curities Dealers, Inc., in Illinois,

election

the

at

Lives etc;

on

Philadelphia National Bank

has been able to ad¬
just rates in favor of consumers

* CHICAGO

•

6%

a

Under the plan,

the rate base.

on

NASD Dist. 8 Board

approved

Penna. Co. for Ins.

decreases

or

fall short of

or

Exchange Nat'l Bk. & Tr. Co.

Fidelity-Phila. Trust Co.

This plan provider

increases

satisfactory

CHICAGO,

Board of Governors of W.

Central-Penn National Bank
Corn

the company

/

\

.

W. Gilbreath Named

have

!

NY 1-1557

Girard Trust Co.

charged by the company
made as annual earnings ex¬

ceed

ST. LOUIS

■;

25 Broad St.

New York, N. Y.

sliding scale arrangement under

are

New York Stock

BH 198

Direct Wire

"Wash¬

so-called

the

under

ates

ROBERTSON & CO. Street

Bldg.

La. Birmingham, Ala.

New Orleans,

serves

in rates

Wall

Members New York Stock Exchange

the District of Columbia and oper¬

which

Members

;

Maritime Bldg. Brown-Marx

:i<

Electric Power

Potomac

ington Plan."

40

1 -

■

of

the company,

MR. GEORGE NELSON

Now Associated

r

' \

Steiner,Rouse&Co

and it is the only

-

Is

:

i

Debardelaben 4s, 1957

maturity, the bonds con¬

1942, according to the prospectus:
funded debt oi

DEPARTMENT

WITH OUR CHICAGO SALES

Announcing that

George

i

•

Birmingham El. 7% Pfd.

property

a

alone

(Formerly

,

000, with-maturities in 1966, 1974
1975 and 1977. This first mortgage

Mr. Willard
in

ii

•

.

which will total $40,000,-

of 3V4s

TELETYPE NY 1-423

BELL

.

,

Alabama Mills:

1977,

due

■

.

stitute the company's fourth issue

AND

HA 2-2772

PI., N.Y.

40 Exchange

series

-

Priced at 113 to yield about 2.67%

t

1920

Established
New York

Members

3*4%

bonds

J

for

Vernon

H.

Fishman,

M.

partner of William I.

Co.,

New

York

City,

formerly

a

Fishman &
and

more

recently with the New York office
of

Wyeth &

WAAC.

...

Co., has joined the

.w.vlkl.ViSi.i

SMI*;.,,

Volume

THE

Number 4104

156

COMMERCIAL and

"7.

FINANCIAL CHRONICLE
U.

Reg.

Patent

S.

Office

William B. Dana Company

Boggs Marine Captain;
White Heads Trading

We

with

a

BALTIMORE, MD.—William

statistical issue

Monday)

on

Other offices: Chicago—In charge of
f Fred
H. Gray, Western Representative,
Field Building (Telephone State 0613).
J London—Edwards & Smith, 1 Drapers'
|

absence

!

Company,

/

Dana

B.

William

by

1942

Copyright

i

Reentered as second-class matter Feb¬
25, 1942, at the post office at
New York, N. Y., under the Act of Mar.
8, 1879.
ruary

In

BALTIMORE, MD. — Stirling:
Morris & Martin, Keyser Build¬

Subscriptions In United States and ing,
members of the Baltimore
j Possessions $26.00 per year; in Dominion
Stock
Exchange, announce that
of Canada, $27.50 per year; South and
Frederick C. H. Wessel, Jr., has
'Central
America,
Spain,
Mexico
and
Cuba, $29.50 per year;
Great Britain, been admitted as a general partner
Continental Europe (except Spain), Asia,
in their firm. Mr. Wessel, who has
Australia and
Africa, $31.00 per year.
NOTE—On account of the fluctuations been in the investment banking
In the rate of exchange, remittances for business for the past twelve years,
foreign
subscriptions
and
advertise¬ was formerly with Baumgartner
ments must be made in New York funds.
& Co. ■'
:
■

MORTGAGE

issued

HOME

MORTGAGE

LAWYERS
LAWYERS

TITLE

All

&

local

other

40 Wall

York

New

Army.

Bell

Day V.-P. of Cgo. Exchange

Teletype

NY

1-2033

been

has

of

President

Baker Watts To Admit

accept a

BALTIMORE,
MD. — Baker,
Watts & Co., Calvert and Redwood
Streets, members of the New York
,.and Baltimore Stock Exchanges,
will
on
October
1st admit W.

nounced

Lloyd Fisher and Robert A.
to

Stock

Property

position with the Alien
Custodian, it was an¬
by Kenneth L. Smith,

President of the Exchange.

has

Municipal

Mr. Day

since

has been in the Audit¬

1932.

the

at

be further from the truth, in our

can

the

ment.

Victor T. Cranston Is Now
With Weeden & Company
(Special to The Financial Chronicle)

CALIF.—
recently with
Moulton & Company and in

SAN FRANCISCO,

Victor T. Cranston,

past a partner in Howell,
Douglass & Co., has become affili¬
with
Weeden &
Co., 315

the

ated

Sachs

F.

Sept. 10.

offices at

with

Co.

&

Hotel,

Savoy-Plaza

the

effective

Mr. Sachs has recently

been active as an

individual floor

broker and in the past was a
ner

its

in

part¬

Ctfs.

Title

Co.'g

other

Trust

Participations

regulations,

A

It would be silly,

True,

industry additionally

trader

department 36-C

Albert Frank-Guenther Law, Inc.

Commission has not

Advertising

New York

131 Cedar Street

investing

there is overwhelming evidence to support the
that its proposed bid and asked rule and its attendant

However,

public.

conclusion
relevant

provisions is not in any sense

Vanderbeck Goes Farming

constructive and it is the duty

*

of the entire

industry to impress this fact 011

the Commission on or

Vanderbeck

James

that

Sept. 15.

before

of

experienced in

these markets.

connected with the securities

conscious of their obligations to the

Securities,
services

desires

destructive and harmful to the
in the

of course, to say that the

predecessor.

he

is

vestment

announces

discontinuing his in¬
business at 11 Broad¬

New York City, for the du¬
ration, and is entering the farm¬
way,

Wall With Fusz-Schmelzle

—

Merchandising

/ Block

Schram, President

Emil

New

Stock

York

Exchange,

to

The Financial

ST. LOUIS,

ing business.

Chronicle)

MO.—Chesley Wall

has become associated

Schmelzle & Company,

with Fusz-

Dealer Quotation

Boatmen's

Service

describ¬
daily and monthly
changes.
In the past Mr. Wall quotation services issued by the
National Quotation Bureau, Inc.,
curities.
was in the wholesale department
46 Front Street, New York City,
.The group will comprise Emil of Detjen & Co. and was with
will be sent to dealers and brokers
Schram, Albert H. Gordon, Robert Bankers Bond & Securities Com¬
upon
request. Ask for Booklet
J. Hamershlag, George R. Kantzler
No. C-l.
pany.
and Joseph Klingenstein.
Building, members of the
St. Louis and Chicago Stock Ex¬

An

Bank

Mr. Toplitt in the
This is under no

Co,

•

*
-

Schatzkin, Loewi & Co.

interesting booklet

ing the national

;

offer to

circumstances to be construed as an

buy, or as a solicitation
is made only

offering of these Bonds for sale, or a3 an
of such Bonds. The offer

of an offer to buy, any
by means of the

Prospectus.

NEW ISSUE

$5,000,000

COLLIN, NORTON & CO.
We

are

Potomac Electric Power

of a

pleased to announce the opening

Company
.rr

New York Office at

14 Wall Street

under the direction

•

First

Mortgage Bonds, 31A%

Series due 1977

of
Due

\ Dated August 1, 1942

HOWARD E. ST. JOHN

August 1, 1977

resident partner

PRICE 113% AND ACCRUED
We

equipped to give fast and

are

INTEREST

accurate quotations in all

OHIO SECURITIES
Copies,of the Prospectus may be obtained from only such
these Bonds in compliance with the securities

'

Connected by direct

wire to our Toledo office.

of the undersigned as may legally
States.

laws of the respective

offer

Phone WOrth 2-7023

Associate

Members:

New

York

Chicago

Stock Exchange

Board

of




Trade

New

York

Cleveland

Members:

Curb

1-1203

firm, specializing in

solely because they seem desirable

instrumental in making all those

NY

Teletype

Canadian

Commission's viewpoint.

been

New York, N. Y,

2-8970

WANTED

extremely wide powers, but these

how

matter

no

Broadway,

HAnover

Neuhut, Plohn & Co. and

past was with D. M. Minton &
and

Montgomery Street.

Sachs, member of
York Stock Exchange,
F.

Ctfs.

Co.

Members New York Security Dealers Assn.

39

authority or the right to impose rules

of the
has
the New
requested a group of Governors
and Harry
L. Toplitt, Jr., will to, consult with him in a study of
form the partnership of Melville tl\e merchandising of blocks of se¬
Melville

all

opinion, as we

subject to the Commission's jurisdiction.

(Special

Depart¬

Co.

LJ.G0LDWATER&C0!

constitutional rights of all those

the

suspended

time

same

Commission is cloaked with

v

To Form M. F. Sachs Co.

Ctfs.

Title

Complete Statistical Information

in creating the SEC,

subscribe to the theory that Congress,

NYSE Govs. To Study

„

War¬

been with the
Manager of

Trading

Nothing
refuse to

ing Department of the Exchange

firm for some years as

B. H.

Chicago

the

partnership in their firm.

Mr.; Warren
the

Vice-

Exchange to succeed O. R. Bergherm who
recently resigned to

Fisher And Warren

ren

appointed

In

Co.

Mtge.

&

Bank

Invited

Mtge.

INC.

CHICAGO, ILL.—Raymond M.
Day

and

unfortunately true that many dealers throughout
the country, not affiliated with any organization, are inclined to sit
back and await developments, instead of taking an active part in
combating measures directly inimical to their own welfare.
Still
others adopt an uncalled for defeatist attitude with regard to meas¬
ures originating in the SEC, the impression being that the "Commis¬
sion can do no wrong and what the hell's the use of opposing them."

nation's financial economy,

WHitehal! 4-6300

St., N.Y.

In

Specialists

Lawyers
Bond

However, it is

and

■;

...

,

Exchange

4-6551

ESTATE_SECUR1TIES

Lawyers

interest.

certainly do not include the

companies

Stock

or

whose activities are

Newburger, Loeb & Co.
Members

equitably

construed as in the public

resigned to accept a commission
as
Major in the United States

MORTGAGE CO.
MORTGAGE CO.
TITLE GUARANTEE & TRUST CO.
TITLE

has

years,

Are

Inquiries

prepared to impress upon
inflexible regulation
successfully applied and in no sense can be

been appointed
resident manager of that office. He
succeeds Myron F, Ratcliffe, who
eral

N. Y. TITLE &

STATE

Brothers in Chicago for sev¬

man

CO.

REAL

proposed measure and undoubtedly is

cannot be

Appoints Gann;

WHitehall

Commission the many reasons why such an

the

who has been associated with

CO.

GUAR.

&

We

Exchange

this

STREET, NEW YORK

Telephone:

few days remain

CHICAGO, ILL.—Jules F. Cann,
Leh¬

CO.

GUAR.

INSURANCE CO.

TITLE

99 WALL

.

hereby reminded that only

are

us.

Obsolete Securities Dept.

before the Sept. 15 deadline set by the Securities
Commission for the submission of views regarding
the Commission's proposed new rule, X-15-c 1-10.
The over-thecounter industry is by now fully aware of the intent and purposes of

a

and

Ratcliffe !n Army

by

MORTGAGE

&

just talk about 'em, call

*

Teletype NY 1-5

organizations

buy 'em, sell 'em

want to

you

or

Approaches For Filing Comments With
Regarding Bid And Asked Disclosure Rule

Dealers and dealer

MARKETS FOR

CERTIFICATES

If

*

Deadline

Stirling Morris Go. SEG

Lehman

Street, New York

Telephone HAnover 2-4300

:

BOND

25 Broad

*

Victory!

Nearer

Week

CATS AND DOGS

Spencer Trask & Co.
Members Netv York Stock Exchange

F. Wessel, Jr., Partner

'

<

PREFERRED STOCKS

agement of George M. White.

Gardens, London, E.C.

i

One

Industrial

Public Utility and

under the man¬

will be

AND COMPANY

High Grade

If.
25 Spruce Street, New York
Boggs, Manager of the Trading
BEekman 3-3341
Department of Frank B. Cahn &
Herbert D. Seibert,
Co., Equitable Building, has been
Editor and Publisher
granted a leave of absence from
the firm for the duration. He has
:
William Dana Seibert, President
been commissioned a Captain in
,!
William D. Riggs, Business Manager
the Marine Corps and will report
i
Thursday/ September 3, 1942
for duty on September 22nd.
The
Published twice a week [every Thurs¬
Department during his
day (general news and advertising issue) Trading
Publishers

llCHTEDSTflfl

"

of

interested in offerings

are

795

CHRONICLE

COMMERCIAL & FINANCIAL

Kuhn, Loeb &Co.

Exchange
New

Stock Exchange

*•

'

+>

York, September

U'

2, 1942.

Smith, Barney & Co.

BIyth&Co.,Inc.

THE COMMERCIAL & FINANCIAL CHRONICLE

796

1

Our

Reporter On "Governments"
(Continued fronTTlrst page)

MUNICIPAL
RAILROAD

A

glance

; .maturities

Government

the

at

suggests that

list

may

'

Securities Co.
'

1

Incorporated' /

■

!
:.

outstanding-

1943,

,

~ST.'LOUIS.

The, $33,950,000

<:

;

in

;.•

.' v

'•

■

1 to 2.90%

v'

•

tember

has

^

;

■

;^;,l
>

i\.'"■/'<:

,4 ;

r h

+

/'-V

'

'.• '

•

!

•'«

,

ably.

Members St. Louis Stock Exchange

sold,weekly, will be. expanded.

1

be raised to $400,000,000.

may

.

..

v;

•.

of

,

C

"

.

tion in reserve

"

.'

,

*

municipal
to-

.

Company

Stifel,. Nico-

7-

■

Com won Dividend No.

130

^

:

dividend of 75$ for share
XV/2%) fitythc Preferred Stock for the
quarter ending September 30,1942, and
a dividend of 10£ per share on the Com¬

Street;

A quarterly

.

in

systems

completion

mon

<

them

!

.

Street. * Mr. Duff

fof

was

Mr/ Daggett

for¬ Securities, Inc.

was

merly with Holley, Payton & Ger-

^

toyable {October*■ 1. i 942,- ten \
record September 10, 1942.
transfer books volI remain open.

arf

Wis.j office.

,

J:

Manager of -their Madison,

as

non

<

-

?

;

•'

,

Prior; thereto he

trading manager for Robert

was"

and

Phillips & Co.

McfteaA

Moore,.

with

was;

.& McDermott.

-

■

-J! PI 'Treadwell,Jr.; -2,/'

'

J July 22, 1942

DIVIDEND NOTICES

Secretary

ef

the

fi¬

bonds

revenue

The bonds wilL be

issued.

part of >n issue

"and

of $35,009,000

-

wilL.be

^^BERCI^^VESINEOT^Sr
CORPOIMnON

A quarterly dividend of $1.06^

i

special

62I/2C

quarterly dividend of 7 5 cents

per

share in cash

on

COMMERCIAL

INVESTMENT

the Common Stock

an

It

was

avalanche of advance

37I/2C

close. Checks will be mailed.

JOHN I. SNYDER, Treasurer,

payable Sept.

are

exempted securities and not in
others," Mr, Wood declared,
"It is

which

The

September 1, 1942

CITY

KANSAS
First

Preferred,

Series

&

Dividend

B

No.

of

October 9, 1942: also $ 1.00 a share, as
third "interim" dividend for

on

regular

the First

on

the

,

Kansas

entitled

to receive
H.

C.

one

and of seventy-five

A,

stockholders

payable

September

shareholders

of

business

of

close

20. cents

Secretary.

Assistant

chairman stated it did not

desire,
again denied to
it by it by Congress, after a thor¬
ough consideration, of the Com¬

mission^ point Of view; in;i938j"

25,

record

a

share

1942,
at

September

to
the

15.

1942.

September 3,

1942.

cents

record

of

1942.

8,

share

per

at

close

Transfer

.

„

24 Federal St.., Boston




F.

STOCK

Oct;. 1st,
1942,
to stockho'ders
close of business Sept. 10th.

-

on

of

CO.

a

Board

of

Directors

dividend

has

twenty-five

of

the

of

R.

BOLLINGER,

27,

1926,

stockholders

of

September 19,

payable
record

at

the

MARGAY

10,

1942,

to

business

1942.

RUTHERFORD

rule

was" condemned

.,.;

was

Saturday at
tional

a

meeting of the Na¬

Chicago.

committee

,

municipal

Its

approved *

mendation that it
of the

men as

Security Traders Associa¬

in

tion

municipal

further disclosed last

was

a

recom¬

the

position
Association:that,the rule/is

The

:

recommendation

proposed SEC rule

the

on

presented

was

by James F. Musson, of B. J. yan

the

recommendation

invalid

as

represented

the feeling of the entire municipal

fraternity.

The recommendation

adopted said in part:
"After due consideration and
study the municipal committee
of the

National Security Trad¬
Association believes that the
proposed rule Is invalid as it
applies to exempted securities,
ers

and

concurs

sions

of

David

the

M.

Thomson,

with

the

brief

by

attorney

Wood,
Wood

conclu¬

written

of

&

Hoffman,

New York, and President of the

Cancels

Club

of

New

Offering

Securities

The report also
proposal tends to

held that the

September 11
make, an un$799,444.73 Minneapolis, Minn.
distinction between
Last April the city awarded bonds to, a
securities issued by the Govern¬
syndicate headed by Halsey, Stuart & Co.,
ment and those issued by States Inc.
The Northern Trust Co. of Chicago,
and

municipalities, a subdivision
exempted issues not detailed in

New Ydrk,

A

dividend

of

COMPANY

|

Broadway
August 20, 1942.

Thirty (30) Cents per
declared on the Capital

share

has

Stock

($5.00 par value)

payable

October

of record

25,

been

15,

of this Company,
1942 to. stockholders

at the close of business Septem¬

1942.
J. R.

.

end

associates, were the runners-up in the

to the SEC as the
members in reply
to the Commission's request for

report at

FAST, Secretary.

such

bidding.

September

It was voted to send the Wood

Treasurer

26

ber

D. OLDENBURG, Treasurer

Tulsa, Oklahoma, September I, 1942.

club, in which the proposed SEC

once

expression of

day

close of

whole

the law.

September 8, 1942.

August 27. 1942

declared
cents a share on
the corporation of

October

a

adopted an opinion
Municipal Bond
by David M. Wood, of the
York."
law firm of Thomson, Wood &
Hoffman, and President of the New Orleans

of

GEORGE H.

issue of

April

club

holders of record

outstanding stock of
160,000 shares provided by amend¬
ment
to
the
certificate
of
incorporation of
the

|

of

.

Treasurer.

DAIRY PRODUCTS

NEW YORK TRANSIT
the

this

The

under ' the

CORPORATION

business
will not

books

.Sentiment of

,

written

A dividend of 20tf per share on the Common stock
has been declared, payable October 1, 1942, to

$25

LOHMEYER, Secretary.

CORPORATION

E.
.

&

i

Chicago Meeting Also
Raps Proposal
;

„M„

NATIONAL

DIVIDEND NO. 49

The

per

LIGHT
DIVIDENDS

POWER

MAR'GAY OIL CORPORATION

OIL

of

declared a quar¬

has

in 1936, and which its then

gress

supportable

par common stock will be paid October 1, 1942,
to

BALANCED FUND
.dividend

-

the dividends.

DAVIS,

H,

declared

on

R.

OHIO RY.-CO. dividend for the third quarter of 1942 of
dollar per share on Preference Stock, Series

A

eaton & howard
have

-

record at the

close.

Trustees-

CENTRAL

C1„.

THE CHESAPEAKE" AND

September

The

'

•

be closed.

.

1942,|0n"the out¬

.

,

powers

usurp

denied to it by Con¬

Exchange
The above city has cancelled its
The
Board
of
Directors
has
declared the
Act and as an attempt of the Com¬ proposed
offering Sept. 15 of $12,following
regular
quarterly
dividends:
The
70th qtly. div. of $1.75 on the 7% Preferred
mission to seize powers which had 000,000
refunding bonds.
iy,a
Stock;
the 61st qtly, div. of
$1.50 on the
been specifically denied to the
J if
6% Preferred Stock; and the 45th qtly. div.
of $1.37l/2 on the 5^% -Preferred Stock.
Pay¬ Commission by action of Congress. Major Sales Scheduled
able-

the

standing Common Stock, payable September 14,
1942, to stockholders of record at the close of
business on August 24, 1942.
W. F. RASKOB, Secretary

not

Company for the quarter

PREFERRED

63

Missouri. "
August 31, 1942
quarterly dividend of $1.50 per
Preferred, Series "B," Stock
City Power & Light Company
has been declared payable October 1,
1942, to
stockholders of record at the close of business
September 14, 1942.
All
persons
holding stock of the company
are requested to transfer on or before September
14, 1942, sueh- stock—to-the persons who are
The

share

this

JERSEY

COMPANY

LIGHT

Kansas' City,:

■preferred Stock, payable October 24, 1942, to
stockholders of record at the close of business

payable Sep¬

ending
September 30, 1942, payable on October 1, 1942
to stockholders of record September 9, 1942. ;
MATTHEW T. MURRAY Jr., Secretary.

Treasurer

POWER

Board of Directors

Stock of

E. A. Bailey

Wilmington, Delaware: August 17,1942

books will

were

t

the part qf

on

for

Municipal Men Adopt
Wood's Opinion Against
SEC Proposal

to

September 9, 1942.

on

an

earlier

longer-term due dates.

terly dividend of Three Per Cent, on the Capital

at

The Board of Directors has declared this day a
dividend of $1.12J4 a share on the outstanding

bid

'

30, 1942 to.stockholders of record
close of business Sept." IT, 1942.

v

A Company

1942,

Transfer

share

per

Both dividends

*

.

the

have

this

24,

business

COMMON STOCK

not

E. I. du Pont de Nemours

understood .to

(

;

stockholders of record at the close of business

August 27,1942.

on

reg¬

certain

■

New York municipal bond deal¬
ers, through the medium of their
Municipal Bond Club, voted last
Checks will be mailed by the Bankers
week complete opposition to the
Trust Company on September 23,1942.
proposed rule of the Securities
and Exchange Commission, X-15
•/v.,
John D. Finn
Cl-10, demanding in the field of
August 27, 1942
Secretary
exempted securities/disclosure to
GUARANTY TRUST COMPANY OF NEW YORK customers of the best independent
bid and asked prices.
New York, September 2, 1942.

STOCK

(for quarterly period ending Sept* 30,1942)

TRUST

CORPORATION, payable October 1, 1942, to
September 10,1942, The transfer books will

/

Capital

the holders of
record of said stock at the close of »■

'

of

'y

(1

in

Ingen & Co., Inc., New York,
(maturities, chairman of the association's mu¬
with. like .companies andother nicipal committee. .-Mr* Mussoh
institutions
competing j for the
declared.that the position taken in
are

Company of $1.75 per
account of accumulated divi- :

of

tember

share

per

■

business

nation-wide .selling group
invalid, as applied to .State and
reported iearly that active investor
r >
interest in the bonds had been municipal securities/'
The

most, of

the Preferred

on

dends has been declared

$2.50 Dividend Series of 1938

Stock, Dividend

lias been declared

Stock

follows:.

as

PREFERENCE

PRIOR

fer books will not close. Checks will be mailed.

A

dividend

A

declared by

Dividends have been

the Board of Directors,

CORPORATION? has-been declared payable
October 1,1942, to stockholders of record at the
dlose of business September 10,1942. The trans¬

Common

■

share

vertible Preference Stock, $4.25 Series of 1935,
of COMMF-RCIAL INVESTMENT TRUST

york, n,y,

attempt^

definition to

„

prior to the formal offering. Banks

Street

Preferred Dividend No* 137..

DIVIDEND NOTICE

the Con¬

on

Corporation

•

-

Convertible Preference Stock,
$4.25 Series of 1935, Dividend

^

,ww

Industrial Loan

''

3Q Church

...

other

or

,

of. the city of San j
payable from the net;
revenues
derived from opera-!
tions of the electric system and;
gas distribution system of the
city.
V
^

said that

/;

definition of de¬

a

devices or; contriv-;

the

ulate

j

obligations

manifest for all maturities.

American Locomotive Company

ILLINOIS.

and which were

bonds authorized under the in¬

denture,

flad

regarding-

«■

manipulative

in the guise of

gas

orders had come into the market

Beneficial

inquiry

•.

these"

be

but rather, is an

ances,

the

Antonio

department merly Vice-President of .Traction

their; sales

im Chicago.

Stock have been declared. Both div/-

The stock

in

Salle

with

associated

now

Chronicle)

,

holders of
*

is

Electric and Gas

—

will

ILK\fex~Akv CHICAGO

fraudulent

facilities, electric and

mortgaged under the indenture

are

Robert W;
Duff has- joined the staff of Link;
Willard Gorman & Co., Inc., 208 South Lsj

that

announce

Daggett

financial

CHICAGO, ILL.

3,;

comprehensive,

We

obligation. ;

"It is not

and

nancing, the city of San Antonio
will own and operate the prop¬
erties described, which are to be;
*

to The

(Special

CHICAGO, ILL.

;

\Q) :
'
•' ;
laus & Co., Inc., 105 West Adams
Preferred Dividend..ho, 146 ' ■ v!
■

any

no

ceptive,

areas now

Upon

-

Link; Gorman & Co.

at

lit NAT SANS

,

,

,

Stifel, Nicolaiis Go.

Bandlitif Flori¬

a

RECrummer 8. Company

under which these San Antonio

Bank Note

bonds.

answer

them

owned by San An*
tonio Public Service, Company.

Robt. W.

i

us

attempt
the Commission to
distribution facilities in surround¬

Rate went
:

fives,

['i

'"

generating

distribution

gas

|

,

1

.

.

electric

transmission

requirements through the better demand and bettfer
.

American

'

.

price paid for the last issue of discount bills.
down from 0.372 to 0.369%.
:
;

DIVIDEND NOTICES

the.

issues

backfround of familiarity with

This offering is part Of a trans¬
representing the largest
acquisition of a privately owned

incidentally, the Treasury has benefited directly from the reduce ing

,

'

'

-

Guess is, the total offering city, and certain electric and

.

da

utility property for public owner¬
ship since 1937/' The purpose pf
the financing is to effect the pur¬
chase by the city of San Antonio

And then there's a good chance the discount Jbill issues,

,

Our long ' experience In

action

»

/*.••,/ '

r i

on

possibilities? ; Perhaps another certificate, of indebtedness
Issue: will be tried; for theseT securities are popular and. the latest
issue..put~the. %s„of. Aug. 1~ 1943—are now selling at a 2/32 pre¬
mium.
i\ Since the reduction in reserve requirements of Chicago
and "New York banks, demand for this issue has increased notice¬

'""-1

t

^ "f ' \ ,'

far

so

considerable -confidence

What

'

-

He

.

t

Vd;

"•

1M-'' •;
/

'*>

i

j.v*

v'"'

vestment.

v

',fV

-

Bell Systeijv Teletype—SL 80

.

.

509OUYE ST.

borrowing7will come after Labor Day, Sept. 7.

said nothing

with

SAINT LQUIS
//'

.

FLORIDA

MUNICIPAL BONDS

^ while the; 1972 2^2 % coqpon bonds
the Sep-* are priced * at 104 % forJ public in¬

amounts or terms, but we can predict
that the/financing Ibis month. wil}
range between, $2,000,000,000 and $3,000,000,000,. ,
, ;
.
And, this; i$
despite the income tax collections total due on the i5th, , ;.

CO.

ir

"SanAntonio;

according to, maturity,

V'.'/'

Morgenthau has announced that first1 disclosures on

ST/k

!

interest, due serially on Aug/1 in|
1944 to" 1972, Were offered Tues-i
day for general, subscription by a
large underwriting group headed
by Dillon, Read & Co.; ;A: C. Allyn
& Co.; Inc.; The Union Securities
Corp.,. and. E. TL- Rollins & Sons/
! Inc; The 1944 through 1971- ma-1
\ turities were priced ta yield froih

of

amount

the

SEPTEMBER DEAL

THE

,t

.■

>

■

And then figure out your "own refunding"

...

,<

♦

<

1 i Texas,, electric and gas revenue^
bonds, bearing 2Vz, 2% and 3%:
l^s of June;
*

.

.

$400,000,000. policy accordingly*.

■■

FLORIDA

,

*

•

.

T

/

$629,000,000, and the;,
Treasury l^s of Dec.* 15;' 1943, outstanding' in,'the .amount- of»■ \
$421,000,000, seem too' large to admit of redemption in place of' |
refunding.
Certainly the June
seem a logical can-J
didate for refunding.,.
But, any way, Ahe* sensible- policy ]
is to place your bets for refunding on the larger; issues,, your
I
bets for redemption on issues outstanding'in amounts lessr than i
15,

CHICAGO

-

On Market

"/

"

Other nearby maturities sueh as the Treasury

«;

''
San Antonio Bonds

$66,000,000 March 15, 1943, %s;
'
$279,000,000 Sept. 15, 1943, Is;
• \
:"
The $289,000,000 CCC %s of May 1, 1943;
The $324,000,000 RFC lVss of July 15, 1943.
'

,

coming

"

The

Thompson Ross

Thursday, September 3, 1942

an*

* >

these

'

*

The

SECURITIES

"

'

•

be redeemed instead of refunded:
The $232,000,000 December l3/4s;

AND INDUSTRIAL

•

~1

WHAT ISSUES?-—

PUBLIC UTILITY

;

■

'

18

$1,140,000 Cuyahoga Co., Ohio
Last July

17, the county awarded an issue
to a syndicate headed by the Ohio
Co. of
Columbus, whose bid topped that submitted
by Blyth & Co., Inc., and associates.

expression before Sept. 15.
September 22

Summing

up his views of the
rule, Mr. Wood told the club that $500,000 Honolulu, Hawaii

there

can

be little doubt that the

rule, "in so far as it purports to
be applicable to exempted securi¬
ties, is invalid."
,

t

In

June, 1941,

awarded

an

the above city and

county

issue to Dean Witter Sc Co. of
The only other bid for the

San Francisco.

bonds

was

submitted

Hawaii, :H.o.noU|lU,.,,.

by

the

Bank
.

of
V

WHWHIWe^.iHWIWBWil

?IIIWW!WBW<IWntC8BM|WBWai>WBa»W5W»WWa»HWiMI^^

Volume

Number 4104

156

THE COMMERCIAL & FINANCIAL CHRONICLE

We Maintain Active Markets in

Railroad Reorganization

& Sault Ste. Marie
4s &

Walter

l"3v—,»«"

Minneapolis, St. Paul

Tomorrow's Markets

Whyte

5s, 1938

Securities

Chicago, Rock Island
& Pacific R. R.
4s,

4»/2s,

&

1934

797

Brown Co. 5s, 1959

:

Abitibi P. & P. 5s, 1953

1952

Says—;

Minnesota & Ont. Paper 5s| 1960

PFLUGFELDER, BAMPTON & RUST

Roggenburg & Co.
Mevibers

29

Technical indications, lack o£

good

Member*

N.%. Security Dealers Assn.
61

Broadway, N.Y.
Bell

Tel. WHi. 3-3840

Teletype: NY

news,

ket.

If

market

stock;

advance

to

by -Monday;

v\,;y

■

f

7

-

live

market

for

as

a

10

week older... For the

to

some

unknown
did

move

10-day cycles. Some¬
cycle was reduced
less than 10 but it always

times this

worked in units of twos, sel¬
dom in odd figures. Well, the

serious

more

these

tops will begin to ap¬ 10 days are about over, If the
As it is, prices have theory has any value it must
made almost a straight line either take effect within the
move from about the middle
next; three days (that will
of August until the
present bring you into Monday of
date. 7'7;7 <
''
'v/''- next week) or you can look

;?lNow

decline of say anywhere
from three to six points.^ »./•>
a

straight line mar¬
jjt,1
,•«}« »«»♦
.*,
ket, particularly if it follows
a
When one considers pres¬
rally and a minor decline, is
nothing to be disturbed about. ent* market action, present
'

a

•

,

,:

,

On the

contrary when

a

cline is indicated and the

de¬

both domestic and for¬

news,

eign, the total hardly adds up
ket moves across the tape in a to anything which might be
lethargic pattern with no visi¬ called a bullish outlook; •_
\
iji
*;
*
ble trend' indicated, the end
mar¬

v.

bullish

rather

-

than

.

;
Railroad observers are beginning to look forward to the possible
blossoming of a second crop of icicles in hell in the near, future. About

ciation

two and

as

half months ago the management of the new Erie startled
the financial community by declaration of an initial dividend
of $0.50
a share on the new common and
the certificates of "beneficial interest.
It is expected that .the regular
monthly meeting of the Board of
Directors will he held on Sept. 18,
r————
if

and

dend

a

regular

a

action

will

established

RAILROAD BOND LETTER

naturally be taken at

that time.

this

week

will

include

easily

annual income to which

entitled

—together with

provide

refunding

would

holders

5s

be

with

the

old

the

their

on

of

full $50
they were
bonds, it
to pay divi¬

old

necessary

$0:50

provided

was

irrrthe

suggested

some

purchases",in the high yield,
interest-paying group, which

dends of $1.67 a year on the new
common
stock.
Of this amount,

think

we

declaration and it is generally'ex¬

have

better

than

attraction,

average

June

The

~

paid, or at least declared,.-before
the year-end., The main differ¬

Copies available to dealers only.

1

of

opinion in financial; circles
is as to whether the expected $1.00
additional will be paid in two in¬
ence

stallments

or

in

tribution,"1

one

year-end dis¬

'7

.bolstered

the .Senate.
a

recept

approval by

Fpiancg Committee of
that reorganized rail¬

proposal

WALL

WHitehall

STREET,

3-3450 *

ment

NEW

YORK

■

■

Actually
Erie's

ij... is

of'

of

Wm. J.

Co.

Mericka &

Harry

Gawhe, Merrill-Turben & Co., was
named Vice-President; Everett A.

urer.

Correction
In the

!

^'Financial Chronicle" of

August

27th

Andrew

R.

in

reporting

Butler

would

that

become

partner in Butler, Herrick &
Marshall, 30 Broad Street, New
City, members of the New
York
Stock
Exchange, -it7was
stated that;Andrew R. Butler' had
formerly been a limited partner
in

.

Teletype: NY 1-2050

fund.
Earnings statements
non-reorganized
roads
are
normally before su<?h deductions.

of

election

Russell, Gillis, Russell & Co.,
of the Association,
succeeding Edward E. Parsons, Jr.,
President

the

we

firiftV

estimated, that

This

in

was

error;

informed that Andrew R.

are

Butler,

full

by

&iSMSBURGElt& CO!

LEROY

the

J. N.

York

pected that another $1.00 will be

eration I think it's about time

son' of George P. Butler,
one of the original founders of the
firm, has been associated with the
a

firm since

October, 1939, but "Ovas
previously a partner. :',v; "

not

earnings will show further

substantial year-to-year"
ment'in coding months,
final

results

will

be

improve¬

RR.

arid that

well" in

Mortgage Table Ready

The

ex¬

1942

edition

of

"Brooks

Railroad

Mortgage
Table"
and
"The Reorganization Supplement"
estimate at the present
writing
their
old
property ■! investment
are
now
would appear to be in the
ready for distribution.
neigh¬
bases in
figuring excess profits
borhood of $4.25 to $4.50, com¬ The
Mortgage
Table
contains
tax liabilities and for depreciation.
pared with just about $3.00 last tabular analyses of leading, rail¬
While it was claimed that the Erie
road
debt structures while The
year.
Traffic will certainly hold
proceedings represented a recap¬
to high levels,-it seems likely that Reorganization Supplement inter¬
italization and not a reorganiza¬
the rate of maintenance .may be prets the complex reorganizations
tion, and that the road could use
as
reduced in coming months, rind iri
promulgated by the ICC or
its old investment base even with¬
the last third ;of- the year the wage other parties in interest.
*
out the remedial legislation, there
level will be comparable with that
had remained in many minds some
of a year ago.
In some quarters it
Defaulted RR Bond Index
uncertainty as to the validity and is
also believed possible that tax
have a bad stock then you efficacy of such reasoning. These accruals so far
The defaulted railroad bond hiA
may have been on
doubts have now
been quieted,
don't want it at any price^ In
the conservative side, and that the dex of Pflugfelder,
Bampton &
bringing about a marked strength¬
final bill of Erie will be less bur¬ Rust, 61
Broadway, New York
any case you don't have to be ening in the market status of the
densome.. In the meantime, divi¬ City, shows the following range
married to it.v» • - ;
Erie junior equity.
• •
~
:
•
for Jan. 1, 1939, to date:
dend prospects
high—
are further bol¬
Readers of this column are
Even when a wave of uneasi¬
stered
by the company's strong 40%; low—14%; Sept, 2 price—
now committed to six stocks:
ness has
hit the general markets financial position.
Cash items as 39%.

something came along and
prevented prices from going
through. > :
....

OHIO

announces

comparable earnings figures for
most
major railroad systems
for July and seven months 1942

To

bearish.

*

Toronto

King, Maynard H, Murch & Co.,
Secretary, and Thomas A. Melody,
First Boston
Corporation, Treas¬

divi¬

quarterly

policy is to-' be

"The complete optimism that the
amount will be paid in one
way or another has been further

begin cleaning up stale ac
'Ordinarily- such would be the
outlook today if it weren't for counts. " Of course if you're
with
what
the very obvious fact that all satisfied
your
present market-action (and stocks are doing then there is
recent too) is under two tops little to say, except this:' if
—July and August.
If you you have what you think is a
have any doubts about these good stock and the market
so-called tops take a look at goes off? you can buy it back
the markets of July and mid- cheaper.1 If you hold a stock
August. These were tested at which is neither good or bad
least four times in the last —just one of those things—
four weeks. And each time the same thing applies. If you

v,

1-395

Montreal

Cleveland Security Traders Asso¬

Taking all this into consid¬

to

New York

•

be

quite likely

IIAnover 2-0980

Elect New Officers

to

is

Y.

Teletype, NY

CLEVELAND,

.....

result

WILLIAM ST., N
Bell

-r v

Cleveland Traders

pear.

for

SECURITIES

reason

in such

(about 110) rthe

52

Bell Teletype—NY 1-310

.

a

I further

the market

thing on the upside it had
better do it before we are a
stays

,

REORGANIZATION

attempt to

days.

for

said that
reason

longer it
under the, July tops

HART SMITH & CO.

Exchange

move

some

not:

Stock

up^ta its indications for

another

enough in this range (106-107
D. J.) and if it's to do any¬

...

indicated

back off' and

WALTER WHYTE
'
", " ■■■•■.
"
is-1
The market has stayed
long
By

■

-

the

then

and
.

*

!

or -

whole may

technical picture must change

1

RAILROAD

t

added to seasonal
trends, make for down mar¬

York

New York

Telephone—DIgby 4-4933

1-1928

New

Broadway

;

cess

roads shall be allowed to maintain

of

$3.42

share.

a

The

best

.

•

In

the

events

usual

course

of

market

finding over¬
Air
Reduction, Allis Chal¬
stock too much to
take at one gulp may back off mers,;
Crane,
International
to get anothe? shot at it. This Harvester, Pittston and Union
Carbide.
'
' .v
"JV
backing off is simply another
a

hanging

;

word for reaction.

•

Or it may
I advise

just lie still,
gathering
strength until it has absorbed
enough to try it again. Of the
two, the latter seems in, evi¬
dence today.
;

follows: Air Re-

as

| duction—-stop ) at

31.
If. it
profits at 35
or; better!/' Allis Chalmersstop at 23. Half profits at 27
*
*
*
or better.
Crane—stop at 11.
Last week I discussed what Full profits at 15 or better.
rallies take part

10-day theory. I International Harvester—half
show how a single profits were taken at about
50.
Stop the rest at 44V2.

I called the
tried

to

Pittston—because of its
it's

LAMBORN & CO.
99

...

in recent weeks Erie

common

and

beneficial

in¬

of the end of June were in

excess

.

WALL

price
figure. If
get about 3 for it,

difficult

a

one

you can
take it.
Union Carbide—was

STREET

another

NEW YORK CITY

profits
hit 70.

stock

SUGAR

which

half

Mi

More next

irticle
time
4-2727

views
do

Chronicle.
.

not

coincide

Thursday.
Whyte

necessarily at
with

They

those

this
any

of the

presented
those of the author only.]. •
are

.

sell

to

in

heavy volume in new high ground
This market position
should be further strengthened if
the directors give an indication of

their purpose of putting the shares
on a

regular dividend basis. A reg¬

ular, rate

certainly
der

of

$1.50

appear

a

year; would

conservative

conditions and

present

seeable circumstances. '

.

un¬

fore¬

C'"

Erie has been

enjoying a highly
successful year despite the impact
of substantially heavier mainten¬
ance
work, increased wages and
inevitably higher tax rates. Gross
for the first

showed

a

year ago

seven

rise of

some

27 %

over a

than

$700,000. The
equivalent to,ap¬
proximately $0.43 a share of com¬
more

gain in net

$3.42

at
,

a

was

share for the full year
the standpoint of a

From

feasible and conservative dividend

policy it should also be noted that
a large share of reported earnings
should readily be available for
distribution, as these earnings are
after allowance for sinking funds
and

of

$25,000,000

and equivalent to
years' fixed charges.
addition;
miscellaneous
ac¬

almost
In

four

for the additions and'better¬

Producing

counts receivable were more than

double those of

a

gating $5,913,000, and inventoried
of materials and supplies Had been
bolstered heavily.
1

On

the basis of the

structure set

sound

debt

reorganization
as well as on the
prospects of more
liberal and regular-income return,
many rail men are. still pressing
for an exchange into Erie from
such marginal equities as Central,
Northern Pacific, Southern Pacific,
etcto
t'
7
7• -T.
•"
up

Oil Royalties

year ago, aggre^

m

offer

the nation at war,

brokers
on

we

blocks

in
Oil

addition,
Royalties:
Are

1.

more

based

on

the

Pay monthly returns from
leading oil companies;
Carry

4.

Are

a

substantial income

deduction privilege;

ideal

an

inflation

hedge for both large and
small investors,

„

<

6s/35 Bonds & Ctfs.

Why not get the facts
can

Georgia & Alabama
&

gross

of7o*l

2. 1

tax

HIGHEST GRADE RAILS

5s/45 Bonds

that

from:
''"specific pieces of land;

We also maintain, net markets in

1st

than

..

remember

production

odd lots of

Seaboard All Florida 7

op¬

3.

invite inquiries

or

oil,
before, is vital.

ever

;
As

timelyinvestment

a

portunity for your clients. With,

■

months of 1942

and net operating income

increased

of

in

of

continued

for the year.

1942.

expressed

have

the year this would allow earnings

*

—Walter
rThe

certificates

terest

mon.
Without any';'further im¬
it provement during the balance of

when

Stop the rest at 66.

Exports—Imports—Futures




in

taken

were

*

Dlgby

to

the

Ctfs.

the

in turn talk to

your

so

that

you

clients about

investment

advantages
Royalties?
We snecralize in
them to registered dealers.

cf
Oil
offering

Seaboard, Atlanta & Birm.
4s,

1933, Bonds

&

TELLIER & COMPANY

Ctfs.

Members

1. h. roihchild &
'

specialists in rails

11 wall street
HAnover 2-9175

'

Eastern

Oil

Royalty

Dealers

Association

co.
'

n.y.c.
Tele. NY 1-1293

Established

42

Broadway

1931

New York. N. Y.

BOwling Green 9-7949 >
Teletype NY 1-1171 J

Thursday, September 3, 1942

THE COMMERCIAL & FINANCIAL CHRONICLE

798

and it was done

only

as

a

strong
it.

self-reliant industry could do

tions
all

discussed
ratio

loss

herein, the

for

fire

most

over¬
com-

Of course,

second-guessing is a p'anies in 1942, will be the poorest
relatively easy and popular pas¬ in many years.
In each case it
time.
Unfortunately, neither our will be necessary to look behind
the superficial figures to arrive at
military,experts nor our insuranqe
underwriters can go back and play an understanding of the actual
their hands over.
If they do not situation. What is most important,
This Week—Insurance Stocks
produce, they do not last, and that on a longer term basis, is that
i With
two-thirds of the year now gone, and with the pattern is known as the survival of the there has apparently been no
In
the
insurance
of things to come beginning to take shape, it is perhaps possible fittest.
field, fundamental change in the char¬
to arrive at a fairly accurate preview of underwriting results for however, losses are not always an acter of the fire insurance busi¬
the Fire Insurance Industry in
1942.
Premium income will, of unmixed calamity. Frequently a ness. One interesting, and signifi¬
course,
reach a new all-time peak reflecting higher property bad loss is the best possible adver¬ cant, development of the year has
values, new construction and the unprecedented movement of goods tisement the insurance business been the training of our civilian
can
have because it emphasizes population in fire prevention and
for armament purposes. Most rep-3>
resentative

ently

the

companies will appar¬

write

10%

to

20%

particularly noteworthy
writings last year were

is

because

the

largest in history,

'

•

exceeding

a

corresponding period of
1941.
As a matter of fact, were it
hot for the poor experience in
January and February, losses
would actually be below last year.
Since March, i.e. far- five consecu¬
tive
months,
estimated
losses

•

'

*

1

Plume & Atwood

slight margin those in the
boom year of 1929.
Despite this substantial step-up
in volume, fire losses for the first
seven
months are only slightly
by

*

Sold

—

No

a

sfollows: J

-In Millions—

and

1

York

New

other

Stock

leading

WALL ST.
Telephone

Exchange

exchanges

NEW YORK
DIgby

April

May
June

__ __

_____

*

_______

_______

_______

our

so

our

convoy

methods

so

inade¬

fore

for unusual

any particular
insurance business

receive,
The

relief project.

is not operated as a
In

order

achieve

to

the

greatest

divergence in the re¬
sults to be reported this year by
individual companies is the Ocean

good for the greatest number, an
insurance company must remain
solvent—and to remain solvent, it
must

last winter and spring.

essence

30.8
30.5

29.3

28.0

the

25.6

23.2

24.9

22.4

past decade; as usual, how¬
ever, the companies were in a po¬
sition

to

take

these

losses

"in

profits.
That is the
of the private enterprise

make

insurance busi¬

system—and the
ness

is

one

of the most virile and

examples of such

efficient
tem.

a

sys¬

A;,-,:',--,; /A.-.; ;,A

Had

it

normal

not

been

losses

for

these

Ocean

on

______

23.7

21.0

stride" and to work out

a

satisfac¬

tory modus operandi for the fu¬

ture.

There has been

a

3

49

must

100%

as

be

reserved

it is put on the

for

books and;

if the old business "runs off" more

slowly than new business is added,;

corresponding drain on
the Surplus Account.
As a result;
there may be a superficial* and
temporary underwriting "loss" on

there is

a

Charing Cross, S. W. /

Burlington Gardens, W. I
64 New Bond Street, W.

/

ASSETS

TOTAL

£98,263,226

war

emergency,

:

Associated Banks:

Williams

Bank,

should have defi¬

the war is

after

Australia and New Zealand

A,!

BANKOF

{

NEW SOUTH WALES

-

In The Armed Forces
Kenneth

S.

Beall,

a

partner in
Co., Chi¬

cago, 111., has been commissioned
Lieutenant AV (P) and has re¬

a

ported to the U. S. N. Air Station

(ESTABLISHED

Capital

Paid-Up

£8,780,000

-

Fund

u

Reserve

Liability

of Prop.

6,150,000

actively

SIR

ALFRED

identified in Wall Street for over

and more recently with
Co!, members New York
Stock Exchange, has been
com¬
missioned
a
Lieutenant in
the
years

Ernst

8,780,000
£23,710,000

,

Quonset, Rhode Island.

Ben XV. Boas, who was

1817)

Reserve

DAVIDSON, K.B.E.,
Manager

General

Head Office:

Y

30th
£150,939,354

Aggregate
Assets
Sept., 1941

25

Ltd.

long term value in' reducing

the firm of Cruttenden &

at

Deacon's

Glyn Mills & Co.

,

.

George Street, SYDNEY

&

The Bank of
and

New South

Wales

is

the oldest

largest bank in Australasia.

With over

Ford

T. Hardy, manager

business,

in

-

Zealand, Fiji, Papua and New Guinea,

-

London,

it

and

;

New
and

United States Naval Reserve,

efficient

banking

branches

870

traders

tion. When risks became too great

in

all

States

the

offers

Australia,

complete

most

service

travellers

and

of

investors,

to

interested

in

countries.

minor line, the

Threadneedle

29

47

.

C.

E.

Street,

i

Berkeley Square, W. 1

:':'y

arrangements with Banks

Agency

throughout

the

these
v.

OFFICES:

LONDON

________

business

OFFICES:

Bishopsgate, E. C. 2

8 West Smithfield, E. C. f '

P

.

conscious"

of the
ordinarily, a relatively investment
division
of
Merrill
fire insurance in¬
Lynch, Pierce, Fenner & Beane,
tendency
Totals
$191.5
$187.6
in some quarters to criticize the dustry would be enjoying a very New Orleans, La.,-' has been com¬
of
On
the
face
s,
the
profitable year. Even the automo¬ missioned a First Lieutenant in
industry
for
having
underesti¬
bile fire and theft business, which
straight fire business should be mated the
the U. S. Army Air Corps and
dangers inherent.in the
producing very satisfactory prof¬ Ocean Marine business. In certain has been rather unsatisfactory in will report,on Sept. 4 in Miami,
recent years, is expected to pro¬
its.
However, due to the greatly
Fla., for duty..
% !
; • ► - : A
cases, also, where companies had
duce a good profit. People are ex¬
enlarged • premium
volume land not been
accepting such business
certain other
extraordinary de¬
ercising much greater care in the
regularly, executives have been
J. Kirk Milnor, formerly of Van
and
preservation
of
velopments, underwriting results taken severely to task for becom¬ operation
Deventer.
Brothers,
Inc., ! New
their automobiles.
Furthermore,
for the industry as a whole—and
ing involved in it. But the matter
York City, has been commissioned
most
policyholders Will retain
particularly for some individual was not
quite as simple as that. ';
a Captain in -the U.
S. Army Air
their
fire
and
theft - coverage,
companies—will be considerably
After all, we came into the War
which costs very little, even when Corps and will be stationed at
distorted this year.
For example,
very suddenly and the machinery
Miami Beach, Fla.:
their cars are placed in r storage.
even
though loss and expense had not been set
up by the Gov¬
ratios drop, underwriting profits
Therefore, until sufficient cars are
ernment to assume responsibility
> Sidney L. Parry, Vice-President
of an insurance company may also
actually worn out and scrapped
for administering
the necessary
of the Chicago Stock Exchange,
drop if its premium volume rises maritime and war risk insurance. to reduce the existing supply, no
serious reduction in premium in¬ has been commissioned a Lieu¬
substantially.
This is one of the This has
:now
been done but,
tenant in the U. S. Naval Reserve.
come from fire and theft"coverage
peculiarities of insurance com¬
during the transition period, ship¬
He is taking a leave of absence
is to be expected.
'
U ;
pany accounting which is often
pers obviously required coverage
Because of the special condi¬ from the Exchange to serve on
confusing to the lay investor or —and
they got it.
They got it
analyst who has not had occasion because the insurance
industry
to study the matter in detail. What
could and did cooperate, on a syn¬
happens, of course, is that new dicate
basis, to handle the situa¬

July

LONDON

our

ab¬

Marine

throughout Scotland

equipped

proud of its initial contribution to
the war effort.
But it will neither
nor

OFFICE—Edinburgh

today, and never be¬
have they been drilled and

nite

thanks.
Another element that will make

26.1

$35.6

"fire

HEAD
Branches

are

property losses
over. ■"
.A; v:;

ask,

4-2S2S

31.5

__

_

___

1942

$26.5

__

that

foresee

These shortcomings are al¬
ready being rectified.
Meanwhile
the
Insurance
Industry can be

This was
the nearest thing
to a "catas¬
trophe" that has been suffered by
the fire insurance business during

1941

January
February
March

were.

Marine situation which developed

parison of losses, as estimated by
the National Board of Fire Underwriters, is

they

quate.

have been lower than in the same

A monthly com¬

as

severe

losses

been

they

and

above the

months of 1941.

as

could

one

shipping

that

as

naval defenses would be so weak

Members

have

before

Never

Incorporated by Royal Charter 1727

to fight conflagrations
of all types as they now are. This
experience, i now
being
under¬
taken as an integral part of the

anticipated

Quoted

—

control!

people

would be

Bought

also

Obviously few people, either in
or out
of the underwriting field,

Bristol Brass
•

and

publicizes the ability of the com¬
panies to meet such obligations
when they arise.

more

business in 1942 than in 1941. This
trend

insurance

for

need

Royal Bank of Scotland

the

U.

Aviation

Naval

A.

S.

Cadet

Selec¬

tion Board

until Oct. 21

will report

to Quonset Point, R. I.
Parry has been with

Lieutenant

the Exchange since
came

when he

1928 and be¬

Vice-President in 1939.

Robert M. Pearce, President of
Pearce &

Co., Inc., Camden, N. J.,
appointed a Captain in
S. Army Air Corps and

has

been

the

U.

announces

continue

that

his firm will dis¬
for

business

the

dura¬

'.

tion.

Lawrence Stiver,

S.

J.

Bache

&

>

formerly with

Cleveland^
Ohio, is entering the U. S. Navy. ,v
Co.,

for

the few .companies that nor¬
mally handle most of the ocean
marine
business,
other; leading
companies were invited to partici¬
pate—and
most
of
them
did.
Whether
patriotism or hope of
profit was the* motivating force in

Warner
ner

cago,
ABOUT THE

M.

Washburn,

in Lamson

has

been

Bros.

a

part¬

&

Co., Chi¬
commissioned a

Lieutenant in the U. S. Naval Re¬

TOWN

serve.

Lieutenant Washburn has

Kelly's
taken leave of absence from his
just didn't get around to
firm and will report to the naval
each
case
was,
perhaps, imma¬ seeing it. Well, the other night I did. I expected to meet a motherly
when
the
actual
experience is
training station at Newport, R. I.,
terial.
The job was a big one— sort of person, the kind who -would carry the name Mother Kelly with
highly favorable.
for indoctrination.
proper maternal dignity.
How was I to know that "Mother" Kelly
was a big Irishman, short sleeves and a shirt open at the throat dis¬
playing a hairy chest which seemed anything but motherly. Under¬ T. Courtenay Jenkins Dies
stand that even his son calls him "mother" though his name is Bob.
T. Courtenay Jenkins, partner
That is, Mother Kelly's name is Bob—not his son.
Say, before I get
all confused, I'd better tell you about the show.
It consists of Cully in Jenkins, Whedbee & Poe, Balti¬
Richards, Sid Tomak, the Reise Brothers, Danny Rogers, Jack Oakie, more,
Md.,/died; at his home at
PRIMARY MARKETS IN
Lolita Cordoba and Rence Rochelle;
The whole thing is geared for
the age of 61.
He had been ill
laughs, referred to in less dignified circles as "belly." Done in a series
for about a year.
of blackouts, the comics keep things roaring.
Custard pies, seltzer
squirters and general bedlam is the order of the day here. The com¬
edy lines are equally broad.
No subtlety at "Mother" Kelly's, but
does the crowd love it!
They jiist: roll with laughter. ... It Hap¬
pened in Radio—What with the war the radio people are unusually
The Penthouse Club
careful about admitting anyone to the studios. Everybody must have
30 CENTRAL PARK SOUTH
a pass.
Cliff Nazarro, the double talk expert and movie actor, was
Adjoining The Plaza
signed for a guest appearance and showed up for rehearsal. Unaware
of the pass restrictions, he tried to walk in and was stopped by the
guard who demanded his pass. "Surely, you don't framis the dramA most unique restaurant in
forth on the creeve from Mr.-Royal," said Nazarro.
"I beg your par¬
beautiful location, overlooking
Huff, Geyer & Hecht, Inc.
don?" said the puzzled guard; "I still have the portisan framis that
Mr. Sarnoff delvied for the trismass drill,'' Nazarro replied.
"Uh
New
York
Boston
Central Park to the north.
Chicago
67 Wall Street
10
Post
Office
135 S.
La Salle Street
Square
huh," answered the guard with a dazed look. "I guess it's okay. You
WHitehall
3-0782
HUBbard 0650
FRanklin 7535
Y.
can go in." Another one is told about the rules applying to musicians
Serving best food, skilfully
NY 1-2875
CG-105
using any but the regular "stage" elevators, a kind of glorified freight
car.
All musicians if carrying their, instruments must use this ele¬
PRIVATE WIRE SYSTEM CONNECTING:
prepared.
NEW YORK, BOSTON,
CHICAOO,
vator at NBC.
One man, .well dressed, carrying a violin case tried
6T,
LOUIS,
LOS ANGELES,
SAN FRANCISCO AND SEATTLE
to enter the passenger elevator.
He was stopped and told to use the
Entertainment after 11 P. M.
TELEPHONES TO
"stage" elevator. "But I have a broadcast in ten minutes," protested
HARTFORD,
Enterprise
6011
PORTLAND,
Enterprise
7<XW
the man.
"I suppose you have," replied the operator impatiently,
PROVIDENCE, Enterprise 7008
"and that's why you'll use the other elevator."
"But I'm Jascha
Telephone PLaza 3-6910
Heifetz," protested the musician. "I wouldnt care if you're Rubinoff,"
said the operator. "You'll still use the 'stage' car."
a

so-called

statutory

basis

even

For

months

(B'way & 50th)

I

have

heard about the doings at Mother

but being naturally lazy I

-

INSURANCE STOCKS




.

a

.

,

[Volume 156

Number 4104

THE COMMERCIAL & FINANCIAL CHRONICLE

v

\

been replaced by an unrealized
profit of $15,152.00, or a total im¬
provement of. $215,107.50.

UNION BOND FUND "A"",

M

UNION BOND FUND "B"
UNION

HISTORICAL

FUND "C"

BOND

'

UNION

'

-

STOCK

DON'T THINK IN CIRCLES

Ordinary

Ordinary Dis-

FUND *'B"

Date

UNION FUND SPECIAL

tributions

Total Dis¬

Dis¬
tributions

10-15-38.-

Prospectus covering all classes
of stock on request

'

$0.12

0.12

0.12

,

7-15-39—

$0.05

0.17

0.11

1-15-40—

!

0.11

10-15-39—

0.02

■

"•

..

0.10

0.10

0.18

0.11

0.12

0.02

0.13

4

0.11

0.11

j

O.il

0.11

0.05

1-15-42— 70.11
?

0.11

4-15-42—

0.16

0.13

•

0.03

0.14

42_i ,.0.11

7-15

•

•'.

$1.76

ordinary
bond

$0.28

distributions

interest

the normal

but

$2.04

are

derived

the

after

deduction

V

from
of

operating expenses of the Fund.

represent true net in¬
income.
Extra-ordinary distribu¬
derived entirely from realized ne|t

vestment

tions,

profits

leading investment company spon¬
point clearly to the dangers of inflation!.
Moreover, their words

of warning are supported with statistics showing the extent to which
inflation has already progressed in this country.
7
'

National Securities & Research
cussion

in

its

Aug.

Corporation devotes the maih dis¬
Timing to inflation undeir the

Investment

27

thought-provoking title, "Cash Is1^
An

Investment."

points

The

bulletin

,•

that

"cash is merely
of investment, with
potential advantages and disad¬
vantages." * The investor today, it
out

another type

concludes,

"cannot really
keep
being
fully-invested
by
holding cash." 7'■/' v.";,
j/.:-.' r
(In commenting on the inter¬
from

confirms

trend

forecast

in

the
its

'bond

net

of

available

"Sinc6

for

is

no

extra-ordinary
paid .only whep

are

realized
such

security

profits

70%

of

the

portfolio of the Fund is currently
devoted i to

railroad

bonds, some
'comment on the position of the
railroads seems appropriate.
An
■increase' of approximately 70% in
{net incqme for the first half of
1942 over the corresponding pe*
riod of 1941 was achieved by the
carriers/whereas industrial com¬
panies generally are estimated to
suffered

35% in the

decline

a

same

of

30

period. The rail¬

have

large invested capital
and most of them will

positions

be"largely or entirely immune to
excess
profits taxes.
Thus, they

Keystone Corporation of
Boston takes an interesting view¬

should be able to increase substan¬

bulletin

[

"7"

;

The

tially their cash holdings which
already stand at

point in its Aug. 21 issue of Key¬
The

notes.

Safe

Is

chart

bulletin

By;

Cash?"

it

shown

is

chasing

means

that

the

tial

power

We

suggest

careful reading

a

of

dollar, in terms of
what
it would
buy in 1939, .is
worth only 76c today.
;
The Aug. 29 issue of Brevits

the figures by all shareholders.

discusses certain

crossed

tion

exact

the

words,

aspects of infla¬
title, "Yields And

the

under

Living Costs."

Taking the period
from June 1941 to last June, the
bulletin points out that last June
the cost of living index stood at
97.3,

from 88.5 for June 1941

up

93.2

from

and

thh

at

of last

end

It goes on to state that, "As
that's not a very rad¬

year.

•indexes go,

ical

but it's nearly 10%
expressed in terms of money
it means that last year's ten dollar
bill is worth only nine dollars to¬
change,

"and

day." ■. ■ '77/..•, *: 77/A ' s-k'i. >7. 77"'
■C7*';:;7:777 Good Reading
; ;
;
A steadfast purpose
umn

is

aid

to

in

of this col¬
the

dispelling

prejudices which isolated past mis¬
takes, faulty information, and bad
publicity have created toward the
investment company field. In this
endeavor
most

do

we

was

thing

panies tell their own straightfor¬
mind

m

It is with this thought
we
are
reprinting

that

the following letter:

7

7

,

of

fund

the

have

now

the $9,000,000 mark.

figure

The

$9,000,728.28

find

on

of this report detailed state¬
covering the operations of
your
corporation
for
the
six
months ended July 31, 1942, and

ments

as

of that date.

v.

.

Investors Fund,
Distributing Agent

BULL, WHEATON & CO. Inc.
40 Exchange

Place, New York




7 "One

significant recent develop¬
has emphasized
the great

ment

for

life

earnings are one of
the most important factors in the
qualification of 'legals.' New York
State is looked upon as a leader in

of the

Fund

to that date.

up

As this letter is written, net asset
value

increased

has

•

182.18.

77>7;""7 7''
interest

"Bond

to

$9,452,-

7' .77; .77 7/7

-

earned

during

the six months amounted to $318,-

Savings

Funds,

this

and

Banks

Trust

and

and bonds legal in
frequently given

respect
York

New

are

paid their, legal status in a number of other
full interest in the: period under states.7 Due to the improvement
review and, in fact, all have done in railroad earnings, nearly $2,5QO,QOQ,000;00 of rail bonds .were
so without interruption since their
original dates of issuance.
Net recently- added to the New York
All bonds held

973.39.

expenses 7 were

Distributions to share-!

...

holders

the

from

tribution

'ordinary v^dis¬

account'

v

during

the!

period totaled $282,366.81 leaving
a
net balance in the account on

quarterly
each

share

payments
on April

of

11c

per

15 and July

In addition
distribution'

15, 1942.
ordinary

an

.

paid

was

'extra¬

from

net

on

distributions

for

the

period
were 25c per share as against 22c
per
share in the corresponding
period of the previous fiscal year.
There

follows

a
tabulation, on a
basis, of the distribu¬
tions paid since the inception of

Fund.

:;/^

cost

of

investments

held

date.

earlier

The

portion of the
period under review
was
characterized by a declining
trend in securities prices which
reached its low point in late April

in

held

are

Fund and New York

legals

repre¬

sented 39% of its investment hold¬

ings

July 31, 1942.

on

the

"Over

;

7 7\;

three
years
the management - has in¬
creased the percentage of railroad
bonds in the portfolio from ap¬
proximately 35% to its present
figure of slightly- over 70% in
recognition of the steadily im¬
proving position of the carriers.
It should be kept in mind, how¬

them

past

two

or

it

pro-

the

to

pocket.

best

"old

4.—Do

are

few rules that

a

Don't
you

but they are worth
because they are the

be constructed.

can

1.—Plan

day.
to

j Know what you

do with your

appointments

aside the time you are
in the office

day

are

day. Make
possible.

how

going

be spent in the field. ; If
think it will help you, have

can

that

so

it

will

be

there

going to

with
have

see

about.

If

acquainted,
specific to talk

one

securities

changed

look

talk

and

sell,

you

have

new

a

of

Go

paper.

believe

and
to

the

over

pick

be

the

tomer's

will

not

(the

you

you

MAKE

order

SHIP

importance.

.there

points that
the

For

five

are

list.

of

it

and

do busi¬

we

you

example,

as

going to

are

No sales¬

our

business

other)

any

REST

OF

but

FESSION.

US

if

PRO7-

HONORABLE
7

.'-7'

■

WHO

SALESMAN/

SECURITY
AN

are

Make

the inside bid

.7:

7-/

main7 selling

the least important at

the

THE

ALL

outstanding, place
which seems to you to be

one

files.

salesmen have to tell

profits. Rule X-15C1-10
stop the small number

same

Set them

if

you

inspect
If you in¬

put it into effect, jt will stop

features of the offering.

INVERSE

when
and

of crooks who infest

down

the

notice;
selling se-,

afford to destroy his cus¬
confidence by dishonest

scionable

attractive

in

way

living

dealing.
Only crooks take unfair
advantage and strive for uncon¬

to

most

their

our

out of business.

us

can

man

situation

what

out

we

with them

ness

special
to
recommend, it sometimes helps to
put the highlights down on a piece

yourself

only

see

books

our

price every time

something

or

you

the

customers

force

the

issue

tall

take

ask

order.

3.—If

the

a

It's

to

more

our

A straight line will al¬
be the shortest distance be¬
sales

please

than

over

sist that

Go

the point.

your

in

way

to make

lot

a

the orders in

rea¬

you

is

curities

ex¬

into the interview with your facts
at hand, make Them brief and to

tween

know how

there

some

be

traded, have the
think so ready.

or

why

sons

should

own

commission—the

P.S.—SEC

are

of them holds

that

feet

—by working for it.

certain accounts

something

and

own

We'll take it the hard way

ence.

we

you

whom

your

aside,

one's

on

trade our jobs for
gilded desks, fancy offices
regular pay checks in exist¬

to

2.—Plan your interviews. If you
are

to

wouldn't

and

in the morning.

you

a success¬

all the

—on

greet

them

cast

stand

make

who

stenographer type out
schedule and have it on your

desk

one

order, mates, and the pay isn't any
too good, especially in times like
these, but there are some of us

going to be

office

your

time.

a

learn how

to

give and take of life.

Set

the

and

to

and

some

you

at

through, how to meet disappoint¬

that the rest of the

so

re¬

concentrate, how to do the hard
jobs first, how to think things

to¬

if

call

a

as

a

one
job until the
has been finished.

are on

ments

work

to

thing

one

start

ful salesman has

1

tomorrow's

referred

Anyone who becomes

timers"

foundation stones upon which suc¬
cessful effort in every, walk of
life

be

can

coat

a

Just before making

minder.

Rail Bond Letter
This

the head of

number

,,

week's

Strasburger

one,

issue

&

of

Leroy

A.

Co.'s

Railroad
include easily

should be Bond letter will
until your comparable earnings figures for
best feature is last.
This is where most major railroad systems for
the sales clincher SHOULD come July and seven months of 1942,
in.
This
is
your
"ace in the together with some suggestions
hole."
Oftentimes we shoot our which,
the firm believes, offer
than
heaviest guns at the beginning of better
average
attraction.
our
sales .talk and then become Copies
are
available to dealers
the next in importance

number

two, and

so on

<

progressively

weaker

as

only

go

we

and

may

be

had

upon

re-"

quest from Leroy A. Strasburger t
& Co., 1 Wall Street, New York
7 7
emphasis at the point where we City.
along. This is just what we should
we wish to place the most

not do if

Clearance Facilities
FOR
...

.:

•

;

•

*.

•

7'

that (your Corporation) is a
general bond fund and that it is
free to alter the composition of

BROKERS AND DEALERS IN SECURITIES

its

ANYWHERE IN THE UNITED STATES

.

ever,

the
on

share

per

Fifteen of these issues
the portfolio of the

$43,-, legal list..

operating
426.98;

holdings at any time to reflect
judgment of the management
changing conditions.

"Your
come

on

may

this report or

at any

nual

of

Manhattan

regular

or

use

of

our

facilities.

of distinct advantage in connection with their sub¬
scriptions to new issues.

time."—From the semi-an¬

report

make occasional

Out-of-town Brokers and Dealers will find the service

the affairs of your corporation

on

•

Both out-of-town and New York Brokers and Dealers

management will wel¬
or questions from

comments

the shareholders

Bond

Fund.

semi-annual

Edwin P. Schneider With

on

apparently was based largely
public expectations of a short

war

to

which,
have

founded.

which

unfortunately,

been

The

not

at

seem

all

subsequent

well

recov¬

Inquiries

.

-v

(Special

to

The Financial

COLUMBUS,

invited

Schneider
with

J.

S.

has

become

Bache

Broad Street.

Chronicle)

OHIO—Edwin P.
&

associated

Trust Company
Securities

Co., 16 East

Mr. Schneider

was

formerly Manager of the Trading
Department for W. M. Zuber &
cline.
However, as of the date of Co. and prior thereto was with
this-letter, this unrealized loss has Stevenson, Vercoe & Lorenz.

of

North America

Clearance Division

115 Broadway, New York

still in progress
has not yet erased the earlier de-

ery

are

J. S. Bache In Columbus

and

Inc.

bonds

represent the largest totals in the

on
July 31, 1942 was $199,955.50
greater than market value on that

Republic

own

thus strengthening
the position of the bonds remain¬
ing outstanding.?
7
*

mental

your

use

repeating

discounts,

July 31, and both that figure and
outstanding
of
1,354,216

shares

"The

Prospectus

purchase of their

to

improvement in railroad earnings.

the

Send for

reserves

Most states prescribe by law those
bonds which are legal investments

total

subsequent

of their

card that can be carried in

in¬

to

way

apply
particularly to the profession of
salesmanship.
Some of them are

ways

on

was

April 15, 1942 in
the amount of 3c per share.
Thus,

pages

its condition

shareholders

gratified by the fact that

assets

ties

"Aug. 21, 1942
will

be

net

that

realized profits on sales of securi¬

"To Our Shareholders:
"You

will

believe

could;

we

to let the individual com¬

ward story.

"We

portions

the
at

These
have found that the! July 31, 1942 of $6,366.69.
distributions took the form of two

constructive

all time record

excess of $1,000,000,000.00.
It is expected that a num¬
ber of roads will devote substan¬

pur¬

of the dollar has
declined 24% since 1939.
In other

an

j figure—in

"How
of a

asks,

unite

and

Here

to

of

Aug. 13.)

to

better

no

efficiency than to learn

advantage.

*

purpose.:

than

more

There

such

they

as

earnings from

are

roads

upward

transactions.

expectancy

•distributions

have

mediate trend of stock prices, this
sponsor

on

regular

The latest publications of three
sors

are

is

self

esses

\The$e distributions

NOTES ON INFLATION

those

confusion of ideas,

a

[

s

of

one

everyone could

There
crease

how

0.11

i,

■

for

etc., etc.?" There is no doubt that
improve in¬
to learning how to mar- ask for the order. Again it some¬
shall
our
thoughts and concen¬ times is helpful to have these
trate them upon a given objective.
highlights typewritten on a handy

|

0.02

0.11

advertisement

an

respect

4-15-41—

10-15-41

you

nearly

7-15-41—

LOS ANGELES

JERSEY CITY

noticed

we

Although this department makes no brief
of these so-called short cuts to self mastery, we were im¬

any

Have

0.10

,.1-15-41—

1.

>

■

0.02

f

63 Wall Street, New York
r

'•"

0.07

0.10
0.10

10-15-40—

CHICAGO

'0.11

7-15-40—

INCORPORATED

day

pressed by the wording of the advertisement. It went something like
this,,. "Do you ask yourself, how shall I begin, what shall I do next?

0.13
0.11

4-15-40—

Abbktt & Co.

,

for

other

in mental training.

courses

$0.12

0.12

4-15-39

,

The

tributions

1-16-39—

rnc.

The Securities Salesman's Coiner

'

Extra-

STOCK FUND "A"

COMMON

OP

DISTRIBUTIONS

UNION PREFERRED STOCK FUND

UNION COMMON

RECORD

799

BArclay 7-1300

appears

.

Complete Domestic and Foreign Banking Facilities
.

7

-

Member Federal Deposit Insurance Corporation

j
'

*. «

SjS

waM^rNMw,

THE COMMERCIAL &

Thursday, September 3, 1942

FINANCIAL CHRONICLE

OFFICERS 1942-1943
Chosen at the NSTA Election Meeting in

John

Edward H. Welch

C.

Wm.

Heclxt

Perry

National Security
BAKER, WATTS & CO.
Calvert & Redwood Streets
BA

395

Calvert 6200

J. Wilmer Butler

(ALEX.) & SONS

135 E. Baltimore Street
BA 383

Calvert 1700

John T. Baldwin

Howard

Riepe

Herbert H. Strawbridge

William J. Herr

R.

Jf Arnold

V.

CAHN (FRANK

B.) & CO.

Equitable Bldg.
BA 390
Mulberry 3200 V:

MACKUBIN, LEGG & CO.
22

Light Street
BA 288
Lexington 3400 :

M.

Mosley

R.

Emmet

LANAHAN

(W. W.) & CO.

480

6 S. Calvert Street
BA 393.
Wm. T.

Bradley

Saratoga 2600

Childs

E. E. McClure

C. William

W. Ilerzog

John

M.

O'Neill

G. Hudson Quarlcs

C. Gerard Morgan, Jr.

Edgar R. Stein

(Continued

Joseph W. Sener

Gustav Klein

Specialists In Quotation Services For
Security Dealers
Publishers of National

v

Plaza 8400

M. David Jones

Calvert Building
BA

STEIN BROS. & BOYCE

29 YEARS

Daily and Monthly

Quotation Services

Descriptive Booklet No. C-l Sent on

Request

National Quotation Bureau
INCORPORATED

CHICAGO

Scanlan

,

Jack C. Creech, Jr.

Harryman G. Bosley

Robert A. Warren

Earl

>

Traders Association BOOSTERS
William XI. Boggs

L. Kellerman

J. Creighton

John G. Chenoweth




Henry

Charles A. Becker

'

Charles H. Pinkerton
v

BROWN

Treasurer

President

COUNCIL

Thomas A. Afcin

Joseph W. Sener

Vice

Benj. H. Van Keegan

Brown

EXECUTIVE

Baltimore, Md.

2nd

President

1st Vice President

Secretary

Chicago August 28th and 29th

NEW YORK

SAN

FRANCISCO

on

page

802)

Volume 156

Number 4104

-

•VC'i

THE COMMERCIAL &
FINANCIAL CHRONICLE

801

Greetings From Present
WM. PERRY BROWN

Notwithstanding

the

cancellation of the

Convention

curity

of

EDWARD H. WELCH

National

Organized

Se¬

Association,

a

great

deal

And .Post Officers

be accom¬
complete disruption of the whole
plished if each and everyone of world
JOSEPH W. SENER
Chicago in 1934
under the
impact of total
you will
the
National
give him your whole¬ war.
Security
Traders
The problems we are
Eight years ago a small
en¬
group
Association, Inc., has done much hearted support and cooperation countering in the securities
of
enthusiastic men known as
busi¬
for the coming
to maintain the
year.
ness
high Standards
are
"Traders" met in the Palmer
infinitesimal by com¬
House
I hereby
of
pledge myself to do all parison.
Trading
in
the
Over-thein
J
Chicago, and in that meeting

patriotic

Ninth Annual

the

Traders

feel

-

the

members who attended the meet-

can

in

the

Wm.

Perry

Brown

Edward H. Welch

;

■

B. Van

ings of the Association in Chicago
on
Aug.; 28-29; -realized as never
before the" importance of their
-

membership in the^ National Se¬
curity Traders Association - and

At

making to the industry.

these

meetings,

the

confidence*

fully

I

membership placed in
nominated

was

to

me

the

to

when I

deliver

a

we

my

of

of

•...

the

EARL M.

yours,

the armed

forces,

home

are

to
of

some

have
the

been

an

selected

National

Association.

honor

Security Traders

It

is

my

desire to fill the position

earnest
as

part

of

just

much

as

a

this

effort as any other
We have been doing
part since Dec. 7, 1941, in a

industry.
our

is

most

work

membership

together

and

without

profit,

of

sale

war

stand

ready

called

upon

bonds

and
at

willing
time

any:

Commander-in-Chief

or

selection

for

great

country for future patriotic duty.
Each and every member of this

Association; is willing to
his

share

entrusted
of

our

of
to

the
him

business

have much

fronting

us

assume

responsibilities
for

the

benefit

whole.

We

serious; business

con¬

as

a

during

these

trying

times and the united efforts of all
will

bring

about

a

most

happy

result.
-

;

Wm. Perry Brown




say we are

as

so

of

us

who

luck

Sincerely

to

JOHN

C.

in

Ludington

I

am

•

ciation

,

hopeful that the

that
as

a

I

great

Another

history of the
Traders

years

my

we

as

M.

Scanlan

pleasure to

work

fully cooperated in every
with the Securities and

at

my
full support to him in his
effort to-maintain the
high ideals
for 'which our
organization has
always stood.

way

Exchange

Commission, National

Association
Dealers
and
the

United States

Treasury.

our

Under

work

in

the

the

and
sale

able

Perry Brown I

lending
of

war

every

bonds.

leadership

cannot

help

of

but

President, William

;

M.

an

ness

phere

we

have

seriousness

ever-growing

seen

before.

very

comes

from
of

able

to

serve

as

the

these

for¬

will

of

an

^

L

am

part, will be

the membership

as

■

has

of

the
•

been

pleasure to

Curtis

an

serve

during the past
coming

\.

today
the

members
•;

'

of

?

honor
the

year.

officers,

and

To the in¬

"heartiest

con¬

Joseph W. Sener

(Continued

on

a

Association

gratulations and best wishes!";

'

John C. Hecht

&

us

with

fortitude and spirit which is

'

administration of the

Very truly yours;

the

met

'

which
a

be

Association.

Hecht

past year.

Paine, Webber, Jackson
ESTABLISHED 1879

C.

proud to be

well

'

realization

missing
are

the problems before

It

new

are

We

excellent representation to dis¬

our

administration,

days—an atmos¬
not

meetings.

characteristic

serious¬
about these
meetings in Chi¬

cago the past two

That

a

Many

Consequently,

faces

and

John

There has been

of

Service, is

day.

cuss

Scanlan

BERT F. LUDINGTON

roll

tunate, however, in having such

to give

Sincerely,
Earl

country

serving their.x country in

familiar

these

same

everyone of you have a
part in
this war, either
by becoming part
of the armed forces
(as a great
number of our

defense

new

Perry Brown, and I intend

Each and

membership are
already seeing service), or by de¬
voting time and effort in civilian

are

many

with

Securities

our

composed

every

various other ways.

my predecessors have done.
It will be a

has
For

members who have joined the

more
Earl

it

one.

The honor

Association,

^

:

'

and

various branches of the

have had
very trying times in our
industry and your Association has

of

months
war.-

lengthening

an

unity,

has passed in the
National Security

eventful

an

nine

the

this

*; "

Association,

indeed been

of

deal* of
of

'

year

has been at

learned

country, it
strongly united.

and,; through

incoming nearly

yours,

comes

groups

the

group

we.will go far.

our

past several years, except that
we
have the full
impact of a total
war effort.
.

of

and each
individual number contributes to
the strength
|of the National Asso¬

!

continua¬
have had for the

we

sections

affiliated

HECHT

problems confronting
Association today are a
tion of what

all

is
nevertheless
Each

The

■

membership of
Today we Q
birthplace.
The

2,200.

the

membership
largely through affiliated

all of you.

yours,

ert F.

4 ;;; ;v ~

at

another, I want to
the
doing our best to pre¬

The best of
v

Since that

has-grown

fine representation at these
Com¬
mittee Meetings is
indicative of
spirit of our organization.
While
our

fortunate for

or

concept of the business
knew it.

you

back

are

the

serve

V

Association

During the past few

effort

Cordially yours,

reason

the|

officer
of
the
N. S. T. A. for the
coming year.

by the

our

with

was

We

be

one

born.

Association

the

approximately

to

BENJAMIN VAN KEEGAN
It

pleasure

to

service, from those

have not yet been

it

To

called

Sener

until at the present time
boasts
of
a

our

the

100%.

been

time

W.

was

steadily

'

country mate¬
likewise
have,!
behind

membership.

Edward H. Welch

our

been

the

Sincerely

augmented. the

we

of

and its members.

Our

manner.

has

armed forces of

rially

interests

«.

unselfish

,

best

our

have

who

our;

\ pledge to

Association

the'

Industry in

not

going to
be
found
wanting,. but .'stand!
ready to aid in-whatever
way wej
are best fitted.
Let us renew

the Association

opportunity to see
from day to
day the inroads made
by the Armed Forces and War

well

meaure up

industry

Secretary of

have

Treasurer

we! common good and
surmount all!
to the expec¬ difficulties that
may confront us
tations and trust
placed in us. j
in our daily work.
!
I fully realize
The foremost job ahead for our
the-responsiblity placed upon me
industry is to perform as. patrioti¬ as Secretary for the
coming year
cally as possible in the war effort. and pledge my full efforts to the
Our

I

such

SCANLAN

I feel that it is indeed

Many

Traders

Ludington

Joseph

As

those

adversities with full
have
left
our

any

at

Cordially

P.

Security

'

Benjamin Van Keegan

faced with
many
and must be
ready

whom

We

Bert

;;

help my fellow
officers; in this
undertaking.

consistently

welfare

Keegfan

to

power

are

message to you that

expect to

'

and " to

men

in

organiza¬

have already made the
Supreme Sacrifice.

pleased;

fori * these;

meet

of

of

the'officers

speak

An

worked

general

courage. •
midst for

President of the National
Security
Traders Association and the re¬

to

the

uncertainties

the

sponsibilities undertaken by all of
and members .of; the
Executive Council. .1 I am

firms, it has

Today

-

office

-

business and its members.

realized
that

markets.

tion of individuals
rather than

for

the contribution that the Associa¬
tion is

Counter

National

page

805)

Thursday, September 3, 1942

CHRONICLE

COMMERCIAL & FINANCIAL

THE
802

Traders Association BOOSTERS

National Security
800)

(Continued from page

CO.

MEAD, IRVINE &

Lexington

Patrick J. Cummings

Taylor

CO., INC.

Fidelity Bldg.
Plaza

Ross

Cecil O. Condit

Wilhelm

F. Osborne

B.

Carl

S. Porter

Alex

i

(H. M.) & CO.
S. La Salle Street

BOND

INCORPORATED
30 Federal Street

135

S. La Salle

CG

1122

Paul J.

Thompson

William S.

321

CO., INC.

ELWELL &

209 S. La Salle

(DAYTON)

IIAIGNEY

> Earl M.

OF SALO¬
IIUTZLER

HOUSE

(Not

& CO.

(A. A.)

•

\

,

.

—

duty)

■

&

Andover
v

.

Franklin 8622

I. Moreland

Paul

WYANDT, INC.
135 S. La Salle Street

SCOTT

■

"

J,1'. ' ; ; *5

f

4421

INC.
Street
Randolph 8800

Buhl Building

Federal St.
BS 553
Hubbard 2332
Frank E. Lynch
49

MINTON,

Street

1

•

Leo

INC.

& CO.,
77 Franklin Street
(F. L.)

Thomas

BS

Raymond C. Wauchop
.

-

ENYART, VAN CAMP &

James J. Galvin

INC.

CG 965

HUMMER

.

BS

Paul

Liberty 6080

142

CG

S. La

KNEELAND &

1700

J.

Street

i

<■

5-6261

NV 93

Paul O. Frederick

;

Jacobson

CO., INC
.

ALBERTS (C. A.)
70

& CO.

"

Wall Street

Hanover 2-7025

Chester A. Alberts

Boylan

Edward

„

Salle Street
(FRED W.)

Edward P. Renier

CG 1294

of Trade Bldg.

Woolard

G.

NY

Harrison 2075

Mathews

Bernard J.

(J. S.) & CO.

Wall Street
1-167

,

E.

Arthur

Cunningham

-v

•

(

Digby 4-3600

Alfred B. Averell

Robert Strauss

Burch

T.

36

•

-

.

Schwartz

William S. Hunter

Randolph 4068

John W. Eustice

Board

CG 129

Henry

208 S. La Salle Street

Jefferson K. Hoshor

L. Kent
C.

r

Frank

& CO.

BACHE

STRAUSS BROS.

Patrick Lannan

Francis

Ray Hofer

Erling J. Hansen

$

State 5770

John T.

Wabash 8686

CG 640

FAIRMAN

400 Union

New.York, N. Y.

CG 697

CO., INC.

BANK

COMMERCE UNION

Board of Trade Bldg.

Franklin 7667

State 0101

CG 361

Andover

1251

231 S. La Salle Street

231

-•

NY 1-2310

ERNST & CO.

ADAMS & CO.

.

Donald B. Sherwood

John L. Daley

Chicago, 111.

i

STIFEL, NICOLAUS &
105 W. Adams Street

F. Girard Schoettler

M. Ohnemus

.

(WAYNE) & CO.

Jean A. Horacek

Rodney Darling

Nashville, Tenn.
'

Erzberger

W.

Elmer

105 W. Adams Street

Ahdover 2424

Charles E. Enyart

75 Federal Street

^

R. Donald

100 W. Monroe Street

& SONS
INCORPORATED
(E. H.)

ROLLINS

CO.,

■

Andover 1200

CG 878

Larry A. Higgins

.

Jr.

State 9760

CG 709

i

A.

'

'.

SMITH, BURRIS & CO.
120 S. La Salle Street,!

208 S. La Salle Street

Daly 5392

488

MI

•/!

Street

Welch

Edwin P. O'Brien

CHANDLER

D. Walsh

Liberty 2340

497

John E. Sullivan,

225 E. Mason

Albert Leritz
...

CO.V;,r?

LOEWI &

COMPANY

State 2400
H.

Edward

HULBURD, WARREN &

'

-

AND

La Salle Street

S.

'

Milwaukee, Wis.

W. Parker

CG 252

Candrian

J.

William

Joseph F. Hammel
PUTNAM

231

-

';

'•

Dearborn 1421

864

SINCERE

Casey

Hugh T. Kearns

Walter F. Eagan

:

Randolph 5686

Thomas E. King

J. O'Connor

Fred J.

Blair

R.

Robert

120 S, La Salle Street
CG 972

J. Doyle

James

B. Monroe

Paul

CO., INC. HIXON, STEWART & KING

>1

A. Horn

Clarence

209 S. La Salle
;v. CG

-

Douglas H. Campbell

INC.

John C. Rogers

Dearborn 9600

CG 1200

^

Randolph 2055

292

DE

SILLS, TROXELL &

William J. Lawlor, Jr.

CORP.

FIRST OF MICHIGAN

Frank P. Meyer

Arthur

HUNNEWELL & CO.

Reuter

'

Owen II. Wyandt

P. Warren Donovan

DOYLE, O'CONNOR &
135 S. La Salle Street

A.

Richard W. Pender

Mortimer W. Scott

'*

>

Edwin M. Everham

George

;

!

Randolph 3855

DE 75

(on

Aldworth

J.

;

CO.

Penobscot Bldg.

\

Street

Matthew J. Hickey, Jr.

T. Leo Reynolds

Dayton P. Haigney

Scanlan

ALLMAN, EVERIIAM &

Central 9020

Richard
war

•

■

CG 1234

(PAUL II.) & CO.
10 S. La Salle Street
CG 405

Bldg.

„

Detroit, Mich.

Salle Street -

S. La

CG 840

:

IIICKEY & CO.,

DAVIS

& CO.

Main 3211

DN 90

135 S. La Salle

Liberty 6190

596

BS

C. Mathews

Murray

Federal Street

75

.

Maguire !

James B.

231

John J. Colnitis

Murphy

James II.

& CO.

Colorado National Bank

MON BROS. &

Alfred J. Harmet

Fred R. Tuerk

Moynihaii"

James E.

Franklin 7466

DISCOUNT

Blake,

J.

208 S. La Salle

Cruttenden
Lieut. Kenneth S. Beall, U. S. N.

Opper

Edward J.

1399

INC.)

Street

Dearborn 0500

Walter W.

Liberty 2990

200

;

.*/!

Denver, Colo.

Salle Street

.

Randolph 5360

Central 9744

•

Street

Federal

BS

/.

HARMET

CRUTTENDEN & CO.
CG 35

......

,

SCANLAN (EARL M.)

-

Wolley
Robert S. Weeks, Jr.

,

Charles G. Scheuer

.

,

S. La

Harry Brown

Sumner R.

,

Central 4402

Vincent T. Kane

S. La Salle Street

James

Crockett

Harry W.

i

Donald B. Stephens

Hitchcock

CG 1368

Randolph 6317

163

CG

John H. Dawson

INC.

& CO.,

Bank Bldg.

1st National

Edward S. Amazeen

24

(R. E.)

CRUMMER

I

Ungeher

George W. Smith

CO.
39

Hubbard 4400

545

.

GREENEBAUM INVESTMENT

Cook

Frederick J.

INCORPORATED

.

*

135 S. La Salle St.

CG 81

!

7

Arthur II. Bothen

J. Sennott, Jr.

'

!

.

I

*

•

-

v. 1

Burke

.j

'

Arthur A. Green

-"f. 1

S. Longstaff

CG

Yarrow

Paul

60 State Street
BS

Central 8900

James E.

William

COFFIN & BURR,

Randolph 2977

*

>

Henri P. Pulver

CG 214

Ralph F. Carr

.29 S. La Salle Street

VALIQUET & CO.

105

W. Adams Street

CG

CO.

Street
Randolph 6800

:

i
-'!■

RYAN-NICHOLS & CO.

GOODBODY & CO.

134 S. La Salle

State 4151

Fred E.

Bax

CLEMENT, CURTIS &

Street

Paul J. Skepnek, Jr.

R. Montgomery

105

S

UNION SECURITY CO.

j

'

:

.

Herbert J.

■

CARR

BS

;

-

La Salle

S.

Ralph

Cochran

A.

Harold C. Nelson

Harold Barclay

(RALPH F.) & CO.
Post Office Square
w
328
Hubbard 6442

Andover 3000

Thomas

Street
Central 5690

120

Murphy
Willard S. Putnam

10

115

Loren

C.

■

CG 917

Salle Street!

S. La

CG

CASWELL & CO.

Edward P. Mone

j

.

120

GLORE, FORGAN & CO.

E. Farrell

Arthur

Hancock 4250

Arthur

.

ROGERS & TRACY, INC.

State 8711

CG 273

GOODWIN,

&

,

BYLLESBY
135

.

•

Richard Cooley

;

Linder

L.

Evar

Edgar A. Peck

Boston, Mass.

\

Central 5775

William E. McDonough

State 1790

Martin Lazar

State 0860

CG 1247

McKINNON

Earl C. Glosser

S. La Salle Street

209

& CO.
231 S. La Salle Street
(W. C.)

GIBSON

&

CG 1660

CURTIS

Burke

M.

-

231 S. La Salle Street

JACKSON &

WEBBER,

PAINE,

Joseph T. Fuller

State 9868

95

CG

Edward

2484

THOMSON

J. Cavanaugh

Audran

Carl X. Blomberg

•

William P. Springer

Marquardt

Jerome F.

& CO.
208 S. La Salle Street

State 6693

CG 1124

-

Franklin 2434

CG 1795

Israel Zippin

>

T. Combiths

Wallace

BRAILSFORD

WILLIAMS (C. T.) &
BA 499

William A. Fuller

•

0210

Preston A.

CG

State 0933

CG 1279

Bldg.

National Bank

First

(E. W.) & CO.

135 S. La Salle Street

208 S. La Salle Street

209 S. La Salle

Salle St.

9 S. La

THOMAS

& CO., INC.

MARKS (CARL)

(WILLIAM A.) & CO.
Street
146
Dearborn 9200

FULLER

STEARNS & CO.

BEAR,

Norman J. Powers

*

Thomas J. Cline

(A. C.)

ALLYN

& CO., INC.

100 W. Monroe

CG

940

FAROLL BROTHERS

Street

LEASON

208 S. La Salle Street

Franklin 8400

CG

Thompson M. Wakeley

156

Dominic C. Cronin

Paul

Edward V. Vallely

R. F.

W.

Andover

&

CO., INC.

39 S. La Salle Street

1430

State

Spink

6001

:

Baker, Watts &

'

*

Co.

:
•

Established 1900

Harvey G. Leason

Ferguson

Stock Exchange

Members

New York

Members

Baltimore Stock Exchange

Associate

Members New

Government

Mackubin, Legg & Company

Listed and
Active

YORK

Bonds
Securities

Unlisted Stocks and

Market In Local

Surety
NEW

Bank Bonds
Municipal Bonds

and Federal Land

Maryland County and

ESTABLISHED 1899

BALTIMORE

York Curb Exchange

Guaranteed Bonds

CALVERT AND

REDWOOD STREETS

BALTIMORE

PRIMARY MARKETS IN FIRE and CASUALTY

INSURANCE STOCKS

West

Virginia Representative,

Union National Bank Bldg.

Clarksburg, W. Va.
MEMBERS
NEW YORK STOCK

EXCHANGE

NEW YORK CURB

BALTIMORE STOCK EXCHANGE

Baltimore

New York

Telephone:

Telephone:

CAnal 6-7162

Calvert 6200

Teletype BA 395

EXCHANGE (ASSOC.)

f

r

*

*

v




IM

*

« **

**

V * * J

!

*4 *'

il

J

it

t

Volume 156

Number 4104

THE COMMERCIAL &
FINANCIAL CHRONICLE

803

National Security Traders Association
BOOSTERS
BONN

(W. T.) & CO.
120 Broadway
NY 1-886 Cortlandt 7-0744

,

.

KEIPER AND ZIMM
30

Wesley T. Bonn
BONNER

&

NY 1-865

KNOX

Whitehall 3-9030

Arthur J. Burian

Jacobs

NY

& CO.

135

Louis

CRAIGMYLE, ROGERS
1-1788

Whitehall 4-5290

NY

N. Irving Maxfield

& CO.

John B. Crowley

NY 1-983

1421

PH 70

Frank

; Tracy

Broadway

F.

120

NY

V

•

30 Broad Street

t

>

•"

•

.* I

.Y*.

72

Digby 4-8400

Richard

1-1600

■'

JACKSON

&

INC.
63

61

Wall

v

Frank

39
■

NY
,

(IRA)

Cortlandt 7-6080

& CO.

1420

&

Digby 4-4933

SCIIERCK, RICIITER COMPANY

1431

& MEEDS

Chestnut Street

Locust 6226

SL 456

Building

Garfield 0225

Gordon Scherck

& CO., INC.

war

duty)

Henry B. Gurney, Jr.

Hanover 2-8770

Irving P. Grace

Arthur C.

Irwin R. Harris
4

MILLER (E. W. & R.
C.) & CO.
123 S. Broad Street
PH 84

Toledo, O.

Pennypacker 1570

COLLIN, NORTON & CO.
508 Madison Avenue

George S. Compton

TO 190

NEWBURGER & IIANO
1419 Walnut Street
PH 306

Pennypacker 6161
(on

Charles W. Hahn

Adams 6131

Oliver Goshia

(HERBERT II.) & CO.

II. H. Blizzard

/

Henry J. Richter

Richards

Waterbury, Conn.

Locust 6200

William McC. Schreiner
Clifford Keif
Elmer E. Turner

PHILLIPS

(THE FRANCIS T.)

CO.
59 Center St.

Samuel Blaustein

3-4116

Joseph B. Smith

Thomas J. Joyce

Francis T. Phillpis

ii

Harry J. Peiser

Seneca 2000

St. Louis, Mo.

3940

R. Conover Miller

123 S. Broad Street

PH 160

1-1979

Street

Rittenhouse 0730

'

.

Broadway
1-1920
Digby 4-3000

Chestnut

BLIZZARD

William II. Pflugfelder

NY

168

Jack E. Jones

Elwood W. Miller

Walter K. Barnes

(W. C.)
30 Broad Street

SE

Norman A. Lafferty

Philadelphia, Pa.

/

BAMPTON

PITFIELD

L. Elliott

IIAUPT

1-920

PH 347

1-310

HARTLEY ROGERS & CO.
1411 Fourth Ave.
Bldg.

Cornelius Kelley

John Butler

.

'

Whitehall 4-2400

Pennypacker 5360

LAIRD, BISSELL
>:•

Hanover 2-5540

Broadway

NY

Street

NY 1-897

CO., INC.

Street

Allison W. Marsland

RUST

CO.,

Seattle, Wash.
& CO.

Street

Geo. H. Williams

F. Abbe, Jr.

Wall

NY

-

PFLUGFELDER,
&

428

15th

PH

BARNES & LOFLAND

II.)

Elmer L. Weir
9555

CO.
Land Title Bldg.
380
Rittenhouse

Hanover 2-6627

WOOD, GUNDY &
14

Ernest A. Dahlgren
David J. Lewis

Webster

Ernest E. Blum

Landreth

^

Robert W. Allison

(FREDERIC

PH

E. Everett Van Tuyl

.•

S.

CO.

Garfield 4511

KENNEDY AND

Street

25 Broad Street
NY

Thomas J. Ileffernan

'•

Wall

NY 1-1499

Whitehall 3-8330

*"•

& CO.

Alfred W. Tryder

225

&

Ill Sutter St,

SF 70

S. Broad Street
188
Rittenhouse

HALL, TATTERSALL

VAN TUYL & ABBE j

Vi >■

.

curtis

'

.

OF

Francisco, Cal.

BRUSH, SLOCUMB

NORTH AMERICA

QUOTATION

WEBBER,

San

Bernard V. Tattersall

Louis Walker

Hugh Kilmer

HATCH

COMPANY

115

Front Street

PAINE,

v

A. Roome

F.

TRUST

Graham Walker

•

Walter

123
PH

V. Leibert

NY 1-1900

Russell M. Ergood
Harry B. Snyder

0534

Gerstley, 2nd

GREENWOOD (H. T.)

w

*

Pennypacker 0300

& CO.

'

Whitehall 4-0488

Charles D. Runyan, Pres.

46
;

Hanover 2-8333

1-733

Broadway

Harold B. Smith

BUREAU, INC.

IIARDY & CO.

4

65

•

J.

Bernard II. Tobias

Broadway
Barclay 7-1300

NATIONAL

& CO.

Gertler

Kenneth

PH

forces)

SWEETSER & CO.

Worth 2-4230

-v

Walnut Street
22

Herbert V. B. Gallager
Samuel Kennedy

S. Broad Street
591
Pennypacker

William

Berwald

Broadway

t>

;

John II.

NY

Joe Donadio (with armed

Cornelius B. Sheridan

Street

NY 1-926

213

Kenneth
«

1528

GERSTLEY, SUNSTEIN

Digby 4-7900

1-1227

YARNALL & CO.
PH

PH 426

William Frankel

Alfred I. Abelow

Howard G. Patterson

;

& CO., INC.

C. Benjamin
Mitchell, Jr.
Irving L. Feltman

Colthup

GERTLER, STEARNS
.

(ROBT. C.)

A.

Rittenhouse 2580

Commercial Trust Bldg.
Rittenhouse 0172

Digby 4-8640

Stephen P. Taylor
William P. Congreve

Chestnut Street

FOGARTY, FRANK

Broadway
1-832

(A. WEBSTER)

CO.

Abraham Strauss

MITCHELL & COMPANY

Whitehall 4-3340

Frederick R. Eisele

Wall

&

Randolph

Edward L. Hunter

George II. Wyckoff

BROS.

NY 1-1702

Joseph S. Nye
Joseph Janareli

49

32

NY

Charles Kaiser

'

'

,

Whitehall 4-4396

1-1790

Otto
-

Philip II. Ackert
James

DOUGHERTY

Rector 2-7634

V. McKenna

STRAUSS

R. Engle

NY 1-2288

;

;

-

-

& CO.

Broadway

NY

FREEMAN & COMPANY
30 Pine Street

•

1-2361

Robert Strauss

CO., INC.

,.

Broadway

Laird

Robert J. Campbell

.

Ellwood S. Robinson

MAYER

63 Wall Street

Whitehall 3-7253

Grant

Chester E. de Willers

50
:•

G.

J.

L. Wister

Schumann

CO., INC.

Hanover 2-4562

&

II.

Freeman

Wm. G. Schoonover

(HERBERT M.)

Frank

Michael J. Rudolph
Allen B. Foard

M. Dolphin

Walter

Herbert M. May

ENGLE, ABBOT

Thomas F. O'Rourke

Le®
&

Mosley

John K. Ruckdeschel

DOLPHIN & CO., INC.

Benjamin II. Van Keegan
Joseph C. Eagan
.'.o
George Leone
;

11

II. Walter Mewing

R. Victor

Lightcap

120

NY 1-662

Wall Street

Pennypacker 7330

Kingsley 2400

E. Walton

NY

MAY

D'ASSERN & CO.
-

V

COMPANY,

123 S. Broad Street
PH 296

S. Broad Street

PH 577

Howard V. Williams

Bowling Green 9-9135

49

123

Whitehall 4-4970

SCIIOONOVER, de WILLERS

,

(JOHN B.)
60 Wall Street

■;

Street

&

INCORPORATED

(CHARLES) & CO.

Milton F. Lewis

.

•

CROWLEY
■

CLARK

& CO., INC.

Harold J. Pollack

O. R. Stoll

Pennypacker 8383

Joseph Markman

Fidelity-Phila. Trust Bldg.
PH 299
Pennypacker 4646

Hanover 2-9470

*

John G. Preller

Frank C. Masterson

Joseph F. Guiton
•

1-1140

(E. W.) CO.

STROUD

Frank E. Mulligan
Frank W. Warner

64 Wall Street

Irving II. Isaac
HELRIG (BARON G.) & CO.
60 Broad Street
••/.

Hanover 2-8457

Canadian Securities

,

Baron G. Helbig

v

WE MAKE

IIOIT, ROSE & TROSTER
.

74

Trinity Place

..

■

FIRM

BIDS

ON

SOUTHERN AND GENERAL
-

'

NY 1-375

Government

Whitehall 4-3700

Oliver J. Troster
Willis

M.

James

(on

war

MARKET MUNICIPALS

duty)

Provincial

Currie, Jr.

Summers

-

Municipal

Edwin Tatro

Public

HUFF, GEYER & HECIIT, INC.
67 Wall
!

NY

Utility

Street

1-2875

Whitehall

3-0782

George L. Collins

Commerce Union Bonk

.

Direct

Private

Wilbur Krisam

Wires

to

Nashville, Tennessee

Toronto and Montreal

HUNTER & CO.
42

NY
!1

Broadway
1-110

Gerard

F.

Whitehall

4-2968

Hulsebosch

Wellington Hunter

PAUL O.

120

Incorporated

Broadway
1-319

Lewis
:

FREDERICK, Manager Bond Department

Wood, Gundy & Co.

JOSEPIITHAL & CO.
NY

II,

Rector

Serlen

Benjamin Grody

14 Wall

2-5000
TORONTO
........




CO.

Lewis Tower
PH 25

Walter D. Fixter

Arthur W. Bertsch

Rector 2-1737

s. Lebenthal

MASTERSON (FRANK C.) & CO.

& CO.

Wall Street

NY

1-2272

'

&

Street

Robert McCook

Wm. C. Orton, Jr.
Carl Stolle

Broadway

SMITH

BROTHERS

A. L. Hutchinson

Whitehall 3-3840

(G. A.)

70 Pine

(ALEXANDER)
Walnut

Alexander Smith

1529 Walnut Street
PH 265
Rittenhouse 4488
J. Gentry Daggy

Broadway

SAXTON

2-3600

LEBENTIIAL & CO.

Iloward E. St. John

-

Rector

NY

Wall

Street
Worth 2-7023-

1

1-576

BUCKLEY

A. Kimberly

NY 1-1928

1420

Pennypacker 6754

Richard W. Ileward

Rector 2-4500

NY 1-609

COLLIN, NORTON

•

Oliver

SMITH

Street

Pennypacker 8200
Harold F. Scattergood

Broadway
1-714

CO.

PH 30

ROGGENBURG & CO.

Frederick D. Gearhart, Jr.

,

George Dedrick

•

Digby 4-2960

45 Nassau Street

Whitehall 3-0550

'

14

NY

29

72 Wall Street

•

120

& CO.

KOBBE, GEARHART & CO., INC.

•

A.

(II. D.)

Herbert D. Knox

CLAYBAUGH (BLAIR F.) & CO.

Edwin

1-158

&

1606 Walnut

Peyton Armistead Randolph

Broadway
NY 1-86
Digby 4-1389

Gregory, Jr.

NY 1-2178

BOENNING

Rector Street

NY

11

Joseph D. Krasowich

;

2

Whitehall 4-4950

RICE, JR. (J. K.) & CO.

'

William II.

RANDOLPH & CO.

Street

Henry J. Keiper
Rudolph W. Zimm

GREGORY
30 Pine Street

-

Broad

NY 1-656

MONTREAL

Street, New York

WINNIPEG

VANCOUVER

LONDON,

Bell
ENGLAND

Teletype—NV 93

Phones—5-6261 and 6-6101

Thursday, September 3, 1942

FINANCIAL CHRONICLE

THE COMMERCIAL &

804

***¥?■

'

•

i

il

Favorable Outlook Seen For

_

■

1

v

.

Reorganized Raxlls

roads because they needed it. And,
good business risks, how can you
somewhat of a nor¬ whether they used them or not; once more make them good finan¬ of course, they picked on bitum¬
the very existence of such facil¬
mal
year
average in the
'20's.
inous coal because you don't ship
•
•
.*•
ities
lowers, rates—then in my cial risks?
And
yet if the rate structure
"We have in this country about it by truck." Therefore, the Poca¬
which prevailed in '29 and '30 opinion, in normal times, none of
137 Class 1 railroads.
A Class 1 hontas carriers are prosperous to¬
had continued, despite the loss i'11 the borderline carriers can sup¬
railroad is a railroad which does day because of the fundamental
port the old capitalization; and,
business, then there would have
a
$1,000,000 worth of business a poverty of the 'other; Railroads,-1 /"
been no financial difficulties for generally speaking, the public has
& Western 7 times;
"If you make those eliminations,
year.
Now, ;obviously, we are not
the railroads.
It was the deterior¬ recognized that condition.
"Likewise in that period, being
in a great many of you end up with about 70 Class I
"As a result, whereas in the '30's interested
ation in the rate structure because
students of yields, we: allowed a
those.
Twenty-railroads in the railroads, of which 35 aire in bank¬
we had
a $6,000,000,000 industry
of unregulated competition * that
bond like Nickel Plate 4V2S at 8
United States do 85% of all the ruptcy or, have been reorganized.
on the average, in the '30's we had
caused the compete collapse of
to sell at a higher dollar price by
a
$4,000,000,000 industry.
And I business. The Pennsylvania Rail¬ First, let's' look at the other 35,
railroad credit:
<
'
road alone does 14%. of all the the 35
which are still solvent.
$50 or $60 than the Norfolk &
want to emphasize- the fact that
"For example, rather than earn¬
Western 4s of 1944, simply be¬
that doesn't mean that they lost business; New York Central does Only one in that class has highing, as they did, in 1936 and '37
cause of yield.
7%; Sbutfrern Pacific does 6%. So grade * credit, and
that is die
and '39 and '40, about $650,000,000, $2,000,000,000 worth - of business.
"No one that I know of in that
in analyzing the railroad problem,
Union Pacific." The Union Pacific
That is caused primarily by 1 the
which covers fixed charges about
to boil it down so you can look at has high-grade credit because it. is
period took the fundamental fac¬
deterioration, the lowering of-the
tors into consideration: No. 1—and 11/4 times,- they would have earned
it and analyze* it in frying to de¬
primarily an oil company rather
rate'structure by about 35% over
with the old rate structure over a
when I say No. 1, I mean the di-1
than a railroad.
On the basis of
that period.In other words, dast velop an answer to my. original
duciaries of, the largest type as billion or two, and therefore cov¬
question, I eliminated all of these its railroad operations last" year,'
ered- the fixed ^charges
almost year they didJthe same business Class 1 railroads under $10,000,000 its credit would be about the same
well as of the smallest type, and
in terms of miles that they did in
twice. k So the fundamental dif¬
all of your so-called; expert rail
as the Southern Railroad, only not
1929, and yet they did a $1,000,- gross business. Because in the
houses in Wall Street and in Chi¬ ficulty of the railroads has been
first place, well-reasoned execu¬
as good.
Therefore; there was an
000,000 less business.
So the fact
the deterioration of the rate struc¬
Outside oi
cago. But more important, so far as
that they became a $4,000,000,000 tives and fiduciaries won't buy excuse for that one.
ture caused by unregulated com¬
railroad securities are concerned,
that type of security anyhow, so that, among these
35 railioads,
industry rather than a $6,000,000,petition. •'*"
:
v
•
none of them was able to forecast
there are- none with high-grade
000 industry doesn't mean that they shouldn't have that problem
"Now,
we
can't necessarily
the effect of competition when
in their portfolio.
Likewise, ex¬ credit.;
""""t""'"V.
blame the analysts of that period they • lost $2,000,000,000 worth - of
they entered the t transportation
"You
business:- The business to some cept locally, there is no reason
certainly can't call, the
and the banks and the insurance
business after the war—the last
extent was about the same; it was why individualsshould do that next group, which I call the fbank
companies, because Congress told
war. ;.We knew there.were trucks
either.
If you do that, you elim¬
the rate structure that caused it.
quality' group, because their se¬
us in
1920,v in the Transportation
on the road; we knew there were!
inate about 45 of those Class 1
"But in any event, the railroads
curities are still bank rated by the
Act, that the railroads must have
railroads.
So who cares?
We are various
barge lines; we knew there'were
built up fixed charges of about
services—and they -are
rates which will guarantee them
not interested in that problem; we
pipelines, and so forth; but no one
a
half-billion dollars, and with
Atchinson,
Pennsylvania;,. Great
a
5% % 1 return on their ' capital¬
foresaw the effect of that compelease
lines
thrown
in, it * was wouldn't buy those securities even Northen and L & N, just to use a
a
capitalization based
tation which was absolutely un¬ ization,
if they were good.
So in breaking few examples. If you look at the
close to $600,000,000.
They could
regulated, until 1931, when the upon ICC figures. But, of course, cover those • fixed charges about down this pile of 137 railroads, I junior price or rather at the price
the ICC,'was just as fast .asleep as
cumulative effect of this unre-!
twice with a $6,000,000,000 gross, eliminate those 30 or 40 or 45 rail¬ of the junior securities„7you will
the experts," because as late as
roads under $10,000,000 gross bus¬
gulated competition started to de¬
find that they are selling at a, dis¬
but
with a
$4,000,000,000 gross
1933 and 1934 the ICC"stated in
iness a year.
teriorate the railroad rates. That
count of. 10 to 20 points from qar;
they could not cover them.
Per¬
their annual report, lit may be
is the thing that killed railroad
"Next, in trying to boil this and certainly in this money mar¬
haps the average is about once.
true that the passenger- busses are
credit.
It wasn't so,$Vu'ch the lack
problem down so you can see it ket you can't call Pennsylvania a
getting to, the point- where we Then, * of course, when you have
of business, but it ' was the com¬
should regulate^ but as yet there years like '32 and '38, they; went clearly, I eliminated the indus¬ high-grade, credit when you can
plete collapse bf the rate structure
down -to where they covered the trially-owned carriers, such as the buy the 4.V2 % bonds at 88., £redit
is no- dapgeri-tQ^e-railfoids from
of the railroads caused by the un-i
and
Lake
Erie,
the is judged by where your\junior
fixed charges on the average of Bessemer
the truckingyii^ustry.':1 And yet
regulated >cOmpetitidh that forced
Duluth, Missabe and Iron Range, bond sells in proportion,.to your
only about 51/100's.
y
we know that the deterioration of
the ^ailrpads to beqpme no longer'
"In
analyzing railroads, how¬ the Chicago & Illinois Midland, money market—not., where your
the
rate .structure
was
caused
a
good risk, because they, could
and about five others.
Why? Be¬ highest security bond is selling in
primarily by the trucking industry ever, don't overlook the fact that,
no,.(longer support the • capitaliz¬
while they became a,poor finan¬ cause They :are not,part of" the proportion to the'mohey market,
running absolutely hog-wild so
ation based upon monoply when
problem, because their
cial risk as a result of this com¬ railroad
"Well, what is our first problem,,
far as rates- and regulations were
this competition came in unregu¬
ciedit is the credit of their parent then?
What to do with the secur¬
concerned for the period 1922 to petition, nevertheless, by compar¬
lated forJthe, first 15 years and
—the Steel company or the Com¬ ities of Pennsylvania, Great Nor¬
1938, inclusive.
'V :
,
i : ison, even in the worst year of the
broke the, .rate structure.
They
monwealth
Edison
- Company
thern, L & N, and, Atchison?
If
"At any rate, the old capitali¬ depression, they were a good bus¬
were
no;* longer in a position to
In other words, if they rather than the! credit.of the rail¬ you stiidy the. market .record of
zations of the Class i railroads ip iness risk.
cover
their fixed charges with
7
V
had no debt, they would compete road."
fj'i those roads, you will find that the
sufficients fhargin to make them the United t States, - built- upon
With most of your firms listed in
"I likewise eliminated the Can¬ securities fluctuated up and down
monopoly, built upon a constant

(Continued from first page)
at some of the credit factors, we
would have found out that for
the ten-year period ending in 1929
Rock
Island
covered its fixed
charges IV2 times and the Norfolk

1929 gave us

"

-

.

,

,

-

.

4.

,

,

v

,

.

good risksvv
-'N.
"As an'Indication of what hap¬

if
you compare the years '29 and '30
with the years '36 and '37 and '39

pened to' the railroad industry,

structure, were able to sup¬

rate

port that capitalization. However,
10 or 15.years later, after you had

Bradstreet.

Dun and

over

that thing

If you look

to find out why

people go broke, you will
them

broke because

auto¬

90%

of

136, '37, '39 and '40 are, mobiles, 4,000,000 trucks, 225,000
what we might call the normal miles of pipeline, a $1,000,000,000
railroad years in the period of the spent on the Mississippi and Ohio
to
create1 lower
rates,
'30's.
And combining 1930 with Rivers

they

can't make their

and

this 1 country

in

27,000,000

'40,

go

find that

operating

expenses.; Now in no year have
the railroads been in that, position.

Sq the problem is: If

they are still

at least three times

that;is

adian subsidiaries, because

years

problem; it is a problem

our

by anywhere from 30 to

points.

with Canada and sterling
various other things.

tied up

.

cahontas

and

Chesapeake & Ohio. Why? They
are our only
successful railroads
in
the United
States—the only
They

ones.

are

fluctuated

have

have those of L & N;
have those of Atchison—

similarly;

the

and

the Virginian,

bonds

Northern

carriers—the Norfolk &

Western,

so

so

Atchison

perhaps to a lesser ex¬
tent, but on the junior bonds to
as great an extent.

almost

the only railroads

prob¬

."Without combining this

in the United States whose bonds,

Defaulted Railroad Securities

in the last ten-

60
Pennsylvania debentures,
which now sell at 88, were selling
and
at 48 in 1938; at 23 in 1933; they
"And the last group I eliminated
subsequently sold at par; now they,
in order tq-boil.thiftflown so you
are
selling
around 88.
Great
could see it clearly -was the Po¬
not

lem, as I will later with the prob¬
lem of the borderlines, if .you have

lease-secured, sell on a money
basis.
For. their prosperity—their

problem and yet you have
securities, my suggestion is:
you can call your , loan io
roads.
You have had
five in¬
the Pennsylvania at close to par
creases in bituminous rates in the
last 15 years.
Those Pocahontas during this period, or the Great
carriers didn't need it, but they Northern, whose bonds are seliing(Continued on, page 805) " :
had to give it to the other rail¬

fundamental

the

upon

no

prosperity—is based
of. the other

these

poverty

that if

and
■

.

•

•

r,

1

" i'

,

;

*

*

>

>

' "•

.

r

Reorganization Railroad I Securities
Stroud & Company
philadelphia. pa.

1429 walnut street

Publishers

of

';

Philadelphia

Greetings and Best Wishes from
•

"GUIDE TO RAILROAD

r:

REORGANIZATION SECURITIES"
TRADING
■

s

'

INCORPORATED

v

.

'

.y

DEPARTMENT PERSONNEL

>

R. Victor Mosley, vice president
R.

Victor

Edgar

Mosley

Equipment Trust Certificates

l.,Hunter

L. Wi-ster Randolph

PFLIiGFELDER, BAMPTON & RUST
Members New

York Stock Exchange

-

I '

■

Thomas F. O'Rourke
John K. Ruckdeschel

j.4.

Ra!ilr6ad bonds

Allen B. Foard* Jr.

'

,

Public Utility Bonds &

i

William Congreve

Municipal

Stocks

.

Bonds

Stephen P. Taylor

New York

Broadway

61

Michael J.

Rudolph

U.

S.

Frank J. Laird

Bell

Telephone—DIgby 4-4933

Teletype—NY 1-310

Government

1,

Henry H. Fanz.

William Prescott

Watts,

Obligations
•

■

;

-

*

-

Statistical Department
Railroad

Bond Consultant

i

RAILROAD

REORGANIZATION SECURITIES

bell System
New

*

*

f

»

;»




# *♦»•*«■*» t

La# « "c.»

Teletype

York Wires

-

-

PH

REC.

296-297

2-6528-29

''

yolume 156

Number 4104

THE COMMERCIAL & FINANCIAL
CHRONICLE

Favorable Outlook Seen For
(Continued from page 804)
•
close to par, then that is the time
to close out your loan to those
companies.
Because
if
history
means anything, you
•to ieloan that money

will be able
at a.discount
"of 30; 40/50, or 60 points.
I think
that a better solution, however, is
that I

one

.

shall mention

little

a

bit.later.; .1,
v.v....
■l
/'The big. problem in this
.

.

try is not the
1 mentioned.

railroads

..

.

:...

.

.

coun¬

It is the 25 borderline

whose

securities

forth.

up

meet

those

conditions,

and

at par

bonds alone, to-say nothing of the
.New York .Central;, ;Illi-

body,
charge of Ttbe plans.
Of
course, they listen, to suggestions
from various parties, but
they in
the end write the plan.;
:,
have

..

.

"In

the

olden

days, when we
reorganizations, let's

say

equity

that you Had a lot of under¬
lying bonds.
Take the Wabash
reorganization in 1918. They said,
'This

thing has got to be
So

ized.'

they

reorgan¬

assumed

all

the

benture selling at 52, or N. Y. Cen¬
tral debenture selling at
55, you
want to know what to do. with it.

underlying' bonds without any
question,-.'foreclosed" the junior
mortgage, £nd came out just as
badly as they were before- But

You ire not

not

•at

44,

or

Southern Pacific de^-

a

interested,

time

t said

as

while, ago, in listening to a
long
harangue about the railroad prob¬
a

into

gone

and

been

"The interest o'n .income-"bohds

time

bankruptcy.

numerous

me

get it
have

again.

that Morris &

its

on

Take

the

they get V4 of 1%.

They

Essex will

old

an

this time with the ICC in
control.
To use .that same ex¬
so

feet,

own

you

colony

may

on

.^(Continued,

,

what

j

of you for

the

honor

privilege of serving

and

as a mem¬

re¬

all
re¬

on

806).

page

.

Greetings From NSTA

"So,, there are-, exceptions, .to
everything. .But, generally speak¬
ing, Section J7 has taught us that
know

me

all

duced
the
fixed
charges 72%.
They have" also eliminated about

your

absolutely worthless, to Say noth-<
ing of the stock.

don't

having given
the

..■<

fixed charges of 20 of these 35
organizations, because 20 is
they have passed upon; they

thank

ber of your Executive Council for
the past year.

'The third and next big element
of change that the ICC has made
is
that they' have reduced
the

hands; and you may have a bond
that under the. operation of trus¬
tee
after' trustee might' become

you

OLIVER GOSHIA
I wish to

they get 4V2, if they earn 3, they
get 3; and if they earn
of 1%,

cases

Lackawanna, for instance.
tell

reor¬

administrative. neutral

an

*nois

the problems.. If you have an
Illinois Central debenture .selling

don't

You

come
Therefore,
you
are
through-anything. How do
protected, because a Judicial, neu¬ you know? By the time you get
tral body, the district
court, and through the Morris & Essex and

had

; are

this:

ganization.

;stocks.

Central,: Southern Pacific,
Southern Railway, Northern Pa¬
cific, to mention only a few—they

is

yOtr^'hdxre^gqirrjn a 3s^a^ble,rif earned, to'the near¬
underlying-^ bond until est ^Vi of 1%.' If they earned 4%,

There have

they

have complete charge of the

have

you

They know the existing
and they are dressing
these new capitalizations to

conditions

•value,'. exceed!. $5,000,000,000 ' in
;

railroad

trucks, barge lines, pipelines, and
so

remember

know, whaT

..

have just

ones ,we

to

Reorganized Rails

805

<; -

'

Officials

(Continued from

..

- ^-

page

/

801)

have

you

got in reorganization in hn under¬

HAROLD

SMITH

B.

lying bond until yop have gope
For the past few
years, we have,
through this formula/and there is had our national and
local treas¬
no
way of doing it in advance. uries
improved by the assistance
And the corollary to that is that and
sincere
cooperation of Mr.
railroad bonds sell on
earnings, Herbert D. Seibert, publisher of
and should sell on
earnings, like "The Commercial and Financial
other things do, Take
your indus¬ Chronicle." (Mr. Seibert is an

•

Oliver

This

has

Goshia

been

a

•>

troubled

year

for our
Association, and the mem¬
on the
trial debentures.
bers of the1 Council have endeavo¬
You never look honorary member of the
Security
undisturbed, and up the
ured to take those actions which
lien, because there is no Traders Association of New
to your question.
they have to prove exactly what
York.)
;. *; -*■
would best " serve to further the
lien; you buy them because of
:
"Now, we think we have an they get. They did that in each their earnings. And that is
interests of the Association and!
the
case by
answer
to
introducing what they call
that
problem. \ We
way railroad bonds have got to
Which would benefit the
a
majority
formula for determining just
•think if you have those
sell.
securities,
The mortgage may. mean
of the members:

lem; what

is

you want

an

answer

ample: not

Wabash

single bond

a

out

came

''

-that the

new securities created
by
reorganization of the 35 rail¬

•the

roads

tion

are

.bonds

excellent

an

for

of

any

the

stocks.

or

substitu¬

borderline

In other

words,

the first mortgage bonds of the re¬
organized railroads such as Erie

•and

Wabash, to use those two as
illustrations, are better' bonds than

:ihe

first mortgage bonds of the
Northern Pacific, the Illinois Ceii.tral, the Southern Pacific, and so
:

'forth, for the

very obvious reason
reorganized companies
have been reorganized; their fixed
charges have been reduced to

that

"

the

:meet the conditions as
and the others have

they exist;

yet to shave
.their capitalization down to meet
.the conditions as they exist.

"Likewise, the
'

of

' the"':

income bonds

rd^r^anized

better

are

new

companies

investments

than

any

bi the

line

junior bonds of the border¬
companies.
In other words,

the income bonds
ing at 50

of the Erie sell¬

far

are

better

hold

to

•than the Southern Pacific deben¬
tures Selling at 52, or the Illinois

Central
bonds

-

debentures

and

junior

selling at about the

price.

same

I
shall
give
you
why subsequently,
.

reasons

f;
•

the
/

how good each mortgage division
is.* In other

words, they analyzed
the particular mortgage district to
that it

prove

has

the

earnings—
the amount of earnings to
justify
getting what they get in new se¬
curities.
They have a severance
formula to show how valuable the
line is.
If it were no

longer part
of the system, they have a contributive study to show that it con¬
tributes in the way of originations
or terminations' to
the system as
a whole.
- \
'?/■' ■
"I

will

give

because it is

you

one

example

little bid dry, this
Out here in the

a

formula

stuff.
North Western
reorganization you
have a line from
Chicago to Mil¬
waukee

State

called

Line—

the

;

Milwaukee

divisional

a

bond,

double track, main line from Chi¬
to
Milwaukee.
Undefa
straight traffic density study in
the old days, that was the best
cago

,

bond

in

the

North

tem, and there

are

Western

sys¬

about .16 bonds

in the North Western
system. And

yet,

when they got through an¬
alyzing the traffic (that'goes over
it—they don't originate any; they
don't

terminate

* any -—

under

separate study they could

use

v; a

the

"Going now to the 35 railroads
that have been reorganized or are

old main line of the North West¬

being reorganized, we first had to
study the law to find out what it

rights

was

all about.

pression

all

Prior to

this

de¬

railroad

reorganiz¬
out through
equity proceedings; equity pro¬
ceedings of what we call non¬
ations

■

carried

were

statutory law.
tell

to

There is nothing
what to do.

exactly

you

You sort of follow the
what they did

100

footsteps of

years ago.

ern

or

they
over

could gettrackage
the St. Paul. So that

instead of being the best bond in
the system, it ; was just another
bond. And instead of
getting, as

they ought to
tion

ever

mortgage bonds,
thing like 25%.
"Without
into

if reorganiza¬
100% in first
they get some¬

get

comes,

-

going

that—and

I

any

could

As

a

result,
there
were
various
abuses, and so forth, and 90% of
the capitalizations were not much
better after they reorganized than
they were before.

numerous

further

give

you

y

something, but the earnings must

v

mean

Association has

everything. Because in re¬
organization, - the mortgage " posi¬
may mean something or it
may mean absolutely nothing.
1
"Another point in that
is

the

that

application

If you
on

you

of

the

that

For

have

we

U.

earnings are every¬
While
in1 reorganization
may get a little bit better
because

of

your

I:

•

I

don't

are

the

want

selling

"The

on

ICC

4s

'48

introduced

in

'

have

had

We

bonds

make
me

,

the

1895.

Erie

sell

a

are

carry

on

through' these

i

(

V.

Oliver Goshia

EDWARD D. JONES

^

better.

Banks,

and

individuals'

of

the

national

officers

proceed

advertising..:to
Issue"

the
our

appear

»

of

requested
"Chron¬
members

in

this

September

time.

of

business

any

of

us

have

ever

experienced, both Mr. Seibert and
people
myself have endeavored to uphold
they tell the
continuity of the N. S. T. A.

Some

when

income

bonds

can

income

bonds

Yearbook.

May I thank most graciously all
the

constantly

committees

and

members

of

selling at 85 or 90
the "Chronicle"
staff who have
Edward D. Jones
every
year,
as they have been
made this "News Issue" possible
counts are full of
doing for the last 20 years; and
money.
They
and profitable to our organization.
are
if Atchison earned the interest on
only waiting for assurance
I am confident in years to come
from the U. S. Treasury, i.e.,
income bonds, so did Erie.
And
taxes,
that this venture will prove to be
for the go sign.
yet you can walk into some banks
We look for a
an
outstanding part of the N. S.
and they will tell you that they
good security business for invest¬
T. A.
*
"
»
can't
ment and speculation this Fall,
buy any Erie bonds, al¬
i
Sincerely yours,
With kind regards, I
am,
though they have a bagful on
Harold B. Smith,
1

illustrations—the thing hand of Atchison income bonds.

Yours very

Chairman 1942 Yearbook

./.Committee,

1

.

truly,

Edward D. Jones

passed in 1933, for the re¬
organization of the railroads; and
the

for

first

time

railroads

the

in

first time

in

this

the

history

country—for

since the ICC

Frank C. Masterson

was

BROKERS

-

DEALERS

organized 59 years ago—the ICC
now

has complete charge of rail¬

road reorganizations.
the

final

change

plan

it.

and

The

They write

nobody

courts

it,
but
change it.
They

approve

no
can

IN

can

dis¬

can

Benjamin H.Van Keegan

court
can
disapprove

Joseph C. Eagan

BONDS AND STOCKS

tions, but the ICC in the last an¬
alysis writes the plan.
That, of
course, is a big change.
In the
olden days the bankers reorgan¬
ized the company.

If we use the
Paul, for example, it came out
of bankruptcy in 1928, and I be¬
lieve everybody will admit that it
was

than it
ICC

off when

worse
was

now

petitions.

it

came

when it went in.

has

charge of all

The

They regulate rates for




Frank C. Masterson & Co.
Members New York Curb Exchange

out

com¬

SCHERCIi, mCHTEH COMPANY
St.

it and send it back with sugges¬

.St.

64 WALL ST.

ac-

Convention. of

was

of

;

were

introduced in 1933 and

was

,

insurance

"But with the depression a new
was introduced called Section
It

|

and; that
being

.

law
77.

•

3rd,
1942.
With limited time,-our in¬
We
dustry having gone through per¬
on
haps, the most depressed condition

higher than 52, when I

Atchison

to

"News

now

long

lieu

every

Atchison" income

laugh

me

bonds

for

had

since

that

never
see

income

railroads

have

business

officers which

companies

Smith

with
icle" to solicit from

!

reorganization income bonds.
some'

In

me

which

280 basis.

a

Harold B.

.

your

can buy; if I
Pennsylvania,

of

■ •

1942, the National Security Trad¬
ers
Association held meetings in
Chicago August 28th and 29th and

In other words, if I believe in the
Pennsylvania; I will btiy the high*

yielding bond I

-

mort¬

position/ it is not reflected
ordinarily in the price of bonds.

est

V

Conditions in the Middle
West,
never

gage

don't believe in the

a

,

agriculturally, s peaking,

overall

treatment

to

•

:
•

learned

thing.
you

new

vision

this; formula:

Pennsylvania, don't buy

-

securities

;

belief that our
definite place in

times and into the brighter future
which lies ahead. "
•

the best one, because you are
only
fooling yourself. Likewise on the
Southern Pacific or the New York;

Central:

firm

Meeting have the vigor and the

from

don't like the worst bond

the

my

chosen at this National Committee

connec¬

learn

can

iS

the

tion

tion

It

NEW YORK

Louis, Mo.

THE COMMERCIAL & FINANCIAL CHRONICLE

806

be

can

Favorable Outlook Seen For Reorganized Rails
(Continued from page 805)
$4,000,000,000 worth of stocks as
having no value under existing
conditions. Of course, when I say
'existing conditions,' I don't mean
war earnings which are preva¬
lent at this time; I mean the ex¬

the

isting conditions that we can ex¬

pect in the postwar era as we

had

have de¬
finitely established, which empha¬
sizes perhaps the importance of
buying security bonds, if you have
to buy into a borderline system,
is that the lien of the interest is
the same as the lien of the prin¬
Take the Monon that runs

cipal.

plan
yet; that is,

this city—they have no

into
of

the
So

they

thing

reorganization as
ICC has not approved one.
that the interest will have ac¬
about 10

cumulated for

years

on

bonds before
reorganization.
Now what does
that mean?
It means that they
couldn't support the old debt and
yet, so far as the junior, bond¬
holders are concerned, the senior
debt has increased 50% before the
first

the

mortgage

.bonds'.'can get

junior

of

bonds

Junior

to

And I believe that the

make.

the

anything.
borderline

systems, particularly if the reor¬

In other words,

starts.

made

is

gage

for

the

market

a

first mort¬

new

bonds and the new income

preferred and the
common.
And, of course, the final
part of Section 77 is when all the
appeals are over and have been
bonds and

decided

the

and

the

is

case

mated.

consum¬

7vl";

"Between

three

those

steps,

when the ICC plan

is certified to
and the court approves

the court,

it, and it is then consummated, in
every case of the nine plans that
have gone

through there has been
depreciation in

100%

least

at

Paul, North Western, MissouriPacific, New Haven, Rock Island,
Frisco, Cotton Belt, and so forth,
because there is that mathematical

the same, only

so.

more

briefly

I

as

itself, how

77

Section

for

"As

I will go over it as

does it work?

Several interest¬

can.

parties prepare plans and pre¬
sent them to the ICC.
If a for¬
ed

is

mula

is

formula

a

necessary,

prepared.
Then you have hear¬
ings.
Now this tiling which I
have briefly mentioned may take

from 18 months to
Along the line eventu¬
ally, however, one of the exami¬

anywhere
7

years.

for the

ners

ICC presents a pro¬

posed report, following which the
ICC itself hands down a plan of

reorganization.
This
may
be
or amended, and eventu¬

modified

ally they hand down a final plan
reorganization.
This plan is
certified to the courts; and at that
of

it is time to

particular moment
that

of

ties

this

for

in the securi¬

interested

become

carrier,

reorganized
because

reason:

no

one

And if liti¬
gation does not upset the plan,
that plan is going through. There¬
fore, as soon as the ICC plan is
certified to the courts, you know
change that plan.

can

with

the

illustration.
from

'30

roads

on

I think, of
capitalizations
give you this

way,
new

is

old

to

In the last ten years,

to

'40, the Class 1 rail¬
the average needed about

17 cents out of each dollar to pay

an

the borderline com¬

stock of

easiest

the fixed

ganization
drags
out
for
any
length of time, suffer drastically
because of this capitalization of
interest.
Of course, the effect on
panies would be

"The

the ICC and of the
district courts, would agree that
those
findings could
never
be
made.I 7,;;
"Now once a case goes to the
district court, hearings are held.
If they approve the plan, at that
time trading with those securities
of

principal; in several cases as much

the

ing, the model.

comparing the

200, 300, or 400%. And in my
opinion, the same thing will be
true in the other 12, including the
as

St.

charges. In those days
operating ratio of 75%—that
is, the ratio of operating expenses
to
operating
revenues/was a
pretty good ratio.
Now you put
10

cents'

of

that

worth

and

of

taxes

on

top

85%.
Your joint facilities—that is, the
right to use other people's tracks
are

you

to

up

—amounts to another 3 cents and
you

88

to

up

are

cents.

result, Class 1 railroads as a

As a
whole
•"

did not earn that 17 cents.

7 "While it is

true that in '41 and

'42

complexion of that

the whole

thing will change, We don't know
how

last.

long '41 and '42 are going to
We can't go out and argue

that

the

after

is going to be sufficient to

these old monopoly capital¬

carry

izations.
go

business

railroad

the

war

out

carry

But

do think

I

we

can

and argue that they will
these new capitalizations,
they are built upon the

because

conditions of unregulated
rates, whereas now we have regu¬
lated rates—and, of course, we
anticipate having them after the

pre-war

^i;i'-l.7-.fi.f

war.

"On the basis of the reorganiza¬

tions, those 20 roads would only
have

to

4

cents

out

of

around 77.

dollar

save

to

As

new

to

up

securities
a

matter

a

are

going to

lot more than $200.
of fact, that bond is

today selling at the equivalent of
80.
Why?
Because the new se¬
curities do not sell for the equiva¬

$200;

Y'Therefore,

as

these

securities,
accomplished,
regardless of inva¬
old

the

steps

are

minute—the

earnings
They

put

added

fact

that

these

they didn't put them up.
"What

kind

law,

securities

of

are

How

they?

the

as

Haven

New

it

that

in

went

back, but it went back for a

different reason, as I
later.
"In
court

bonds of reorganized
than you are in the
borderline first mortgage under¬

mortgage

companies

shall explain

ization,

generally speaking, they
capitalization about 30%.
Then they say, 'Here is your new
capitalization.
50% must be in
cut the

Paul

plan,

will be

com¬

in income bonds.

Of the

balance,

pletely reversed by the Supreme

12%% must be reserved for

Court in the St. Paul case.

equipment and for your rent on
leased roads, and the remainde2

I

am

100% convinced that every plan of
c

*

"Let

us

assume

does last two
and

war

three more years

or

have

we

the

that

two-year

a

period

filling in the void of heavy in¬
dustries, and this thing lasts for
five years, nevertheless the lever¬
age is in the new securities of

i

<

'I

O

'I

.

A'.i 'l i'J)




tributed to their customers,

in: situations

method is not

completely

receive

could
to

and a
found whereby they
a

return

in

order

normal

their

overhead,
I've

knows

etc.

got enough

talk

about

that

the next 18 months

over

like

It is

tax.

that

this

from;

exempt

the

are

your

of

return

capital. YYYYYY7VY7 y-Y■;
"Therefore, although I do not
raise the value of that $270, it is

employ salesmenand support

Goodness
to do to

problem.

without ; solving more than $270.1 ■ That reduces
Although frankly, your cost down to $130. And for
when I think of these securities, the $130 you own a $1,000 bond
New York, New Haven and
most of which sell anywhere from in
15 to 35 and 40, there are tre¬ Hartford at 4%.
What do you get
mendous possibilities, as I believe, for
that
reorganization?;. ; The
in them.
(1) They should inter¬ New Haven plan has been ap¬
est you as individuals.
Therefore, proved by the Commission, and
I hope you get something out of it with the exemption.
It has been
from that angle.
(2) They should rejected by the judge because of
influence you on behalf of those a
political«. situation. in Boston
individuals for whom you do a which has to be compromised and
rails

good business and for whom you settled.
can afford to do some business at
general
a

smaller

the

And then, too,

profit.

be

with

true

great many un¬
listed dealers—that if you go out
and convince them of some of

the

But

Haven

settled

and

structure

and theory of
plan have been

premise

New

well

I think—and I have found this to

and

agreed

by

to

everyone.

a

i

"In the first place,

all the un¬

derlying bonds are virtually un¬
disturbed, except the New Eng¬
last sale on the board is 17, you land railroads, who will get 100%
So this treatment of ap¬
can
charge them 18 without too first.
much trouble, or at least 17 %.
I proximately $250 in new first
mortgage bonds, and $550 in in¬
am not trying to answer this prob¬
these railroad situations and if the

were

The next

when issued around 95.

recommending
all

security,

we

.

l

vrfll*

i<

'

Y,

)

i

>■

your

cash position of every one

the

these

reorganized

companies

,

that most of them have paid

large

out

so.

Haven

New

$10

In the case of

paid

assumptions

I

am

making?
I am only making one
assumption: that the war or con¬
ditions

and

as

they now are continue
Because the judge

for 18 months.

in this case
others that if

has set the precedent
and in a good many
he earns the

illustrate

interest, he will pay

Pacific,

I

know

nicipal
it

is

Y

that

unlisted
we

have

securities.
some

mu¬

here.
And I know
enough to say, 'Well,

men

easy
•

in

■

YYT

—I

am

because

I

am

Missouri

j

in the

of

case

'Well,

That is virtually what the

circuit court said.

It is my opin¬

ion—a 1,000-to-l chance—that the
Supreme Court will uphold the
ICC

the

ruling in the St. Paul
North

other

•

1.

case,

Western case, and all
But let us assume

cases.

(Continued

months, they will get back 6%
if

the

rules of this game are all
wrong;
that it has to be
done all over

simply

%

for

St. Louis-San

uphold the ICC plan, but suppos¬
ing you are wrong?'
All right,
supposing I am wrong and the
Supreme Court decides that the

saying that if he pays out as much
as he has been paying out every
six

.

up

be right on your assump¬
tion that the Supreme Court will

only basing it on one as¬

sumption,

that

raise this

you may

"Anyhow, in my opinion, in the
next 18 months these 4%% bonds

interested

•

•

-

you

"You might say

again.

the

that

$20 —$355 for the

North Western and St. Paul,

government—only more so.

and say,

or

Francisco,
Cotton Belt, St. Paul, North West¬
ern, and so forth, but I think that
that example suffices.
-vY; Y-';V

the

my

But

from
70 to 90 and this from 30 to 50,
where some people claim the New
Haven securities would sell,1 and
this from $10 a share up to $35 a
share, this price comes up to close
to $55, for which you are paying
$130. These, I claim, are postwar
prices. This is the price it would
be as designated here, let us say,
if it were consummated during
this particular
period.
I don't
know of any other securities that
have those advantages.
I could
"Now, if

bonds.

what

share

a

be received.

up

bond interests.

"Now

the East Illinois

opinion these New

value of the new- securities is to

road, they have

all the underlying
As a result, if the
New Haven pays out in cash only
what they have been paying out
every six months, then over the
next 18 months they should pay
back 6% interest on these 4%%
now

on

my

interest; and we assuming a price of 30—that is
of course, that they will $165—and cutting this «down to

continue to do
the

incomes, in

Haven bonds will sell at 40.

in

sums

assume,

down to 2812

of
so

rest of it; and the reason which forces
them.
Now what will happen? him to do this is that, being in
If you do get that turned down somewhat of a fiduciary capacity
that so many people thing you himself, the Treasury Department
are going to get, you will still be
has ruled (and the case has gone
better protected by almost a ratio to the circuit court on appeal)
of three-to-one than you will be that if any corporation, railroad, or
otherwise in bankruptcy earns its
with the borderline securities.
"To get down now to what to interest and does not pay it, then
do about some of these things, I the amount they earn is taxable,
shall try to illustrate, if I can. both from normal and otherwise.
If
For there is one thing that I hate So it is academic, in a way.
to do, and that is, to talk to any¬ he doesn't pay it to the bond¬
body and then have them go away holders, he will have to pay it to

Wabash,

Erie,

'Well, so what?' I realize
audience today is com¬
my opinion,
these circuit stocks, a combination of preferred posed primarily, as far as the
decisions out here upsetting and common; 25% at least must be Association is concerned, of men

St.

the

case

think of

each

of

.

treatment and railroads. They have cut the debt
the
same
distinct from about
percentage—
the facts, the judge could not ap¬ about 76%.
prove it, he sent it back. It is true
"As a model of the new capital¬
the

darn few things that you can

securities, once they are
convinced that they should be dis¬

are

per

their fixed charges
against 17 cents for the Class 1

new

these securities up.
to their value but

preferential

under

railroad

Six

^

.

got

selling

are

cent
Now
I have no answer to it.
I wish I what
features
does
that
$270
did have.
It is my great regret have?
The Treasury Department
that the three or four thousand has'ruled that that payment of in¬
is
dealers in corporate securities— terest
in
return
of
capital.
that the Stock Exchange, of which Therefore, it is exempt from the
normal tax. Of course, eventually
we are members, can't find some
way of getting those three or four it will be subject to your capital
thousand
dealers I to / distribute gains tax., and so forth. But there
a

40.

-

much far,

sell

they

interest would be about $270.

Xhosc bonds

around

this type of
best is the Erie, judged by price,
could tell you
which is selling around 92. Then
was that in reorganization you get
must go up,
lying bonds or even: the bank so many first mortgage bonds; so the Wabash, which is around 81,
sions of Low Countries or Pearl
and so forth.
In my opinion, the
quality bonds of a junior grade, many income bonds;
so
many
Harbors or what have you, which
New Haven first mortgage bonds
such as Pennsylvania and Great
shares of preferred;
and, %using
affect them temporarily but they
would sell above those of Wabash
Northern.
Likewise, you are bet¬ low prices, those new securities
come
right back to follow that
and a little bit below those of
ter off in the income bonds of the
would be worth thus and so.
It
course
through.
You can chart
t
reorganized carriers than you are is true that since that time these Erie.
every single one of them, from
in the junior bonds of the border¬ old securities have advanced in
"But assuming a price of only
the original time that the plan has
line carriers.
And, of course, if price.
Why?
Not particularly $170 on these and assuming the
been certified—the Erie, the Wa¬
we believe that for bonds, we be¬
price of your : income
because of reorganization prog¬ average
bash, the Great Western, the Gulf,
lieve it, for stocks,
:r
ly;
ress but because the earnings of bonds is 35, and they range from
Mobile and Ohio, the Boston &
a price of 53 or 54 from the Gulf
Maine, and so forth. So you see, 7 'Without going into too much 1940 and 1941, and, of course, '42
as each of those steps are accom¬
detail, that briefly is our answer and assuming '43, have increased incomes, 51 on the Erie incomes,
•

good are they?
So
as I have stated, they have
higher.
y;//;: ■
;Y • ■
approved 20 plans of reorganiza¬
"Eight of the 20 plans of reor¬ tion. They have reduced the debt
ganization of the ICC have gone 72%—from about $3,000,400,000 to
through and have been approved. about $1,000,100,000. Those are not
The ICC has been upheld in every the little railroads. They include
case in the lower courts, with the
the St. Paul, the Erie, the North
exception of the St. Louis-San Western, the Rock Island, the
Francisco where, because the RFC 'Frisco, and some of our larger
of

lent

today

pay

plished, regardless of the stock to what to do with these railroad
going to get, if the market, regardless of extraneous securities. Now you can prove to
wars, and so forth, there has been me that the Southern Pacific are
plan goes through.
mathematical mechanical
de¬ making more money than they
"About two years, when Erie a
generals were selling, for exam¬ preciation of the securities be¬ have ever made in their entire
ple, at 20, the ICC plan was cer¬ cause of the possibility of new history; and the chances are that
tified
to
the
district
court in markets being created; then the the Illinois Central will also do
Cleveland. You knew that if that actual new markets in which the the same thing.
The same is true
plan went through, you were go¬ securities are issued; and finally, of the St. Paul,, the North West¬
ing to get $50's worth of first with the appeals out of the way, ern, and so forth. They show me
mortgage bonds, $500's worth of the actual delivery of the new where the Southern Pacific will
If I had time, I would cover their fixed charges three
income bonds, and 3% shares of securities.
preferred.
Therefore, that was trace for you the steps and dates times this year. Admittedly, but
the time to buy the older Erie se¬ in Erie as this thing - happened. the St. Paul will cover their new
curities, because obviously, with¬ It wasn't the new earnings, and fixed charges almost 10 times this
I will explain that in a year.
out doing it on the blackboard, so on.
add

interest,

about are"listed.' How am I

lem, but I am simply trying to come bonds, and the balance in
(two shares
of pre¬
anticipate a question that I might preferred
as
;
get later, 'So what?
How am I ferred), has been established.
"As I said, the average price
railroads as a whole.
So i in my going to make any money out
nothing by buying the old securi¬
of the new first mortgage bonds
1
opinion, they are no different than of it?'
; ^
ties at the price you can now buy
is 75.
70 hotels or 70 drug stores: the
They range — the lowest
"Let me illustrate now with one
them for.
They are not going to
amount of rent you pay out of
price bond is the Chicago & Great
bond, the New York, New Haven
sell for nothing.
They are going
each dollar is important.
And I and Hartford at 4%—refunding Western—the new first 4's, which
to sell for value.
The average
sell around 67. The highest price
think it convinces me—and I have
4% at 67—one bond of about 10
price of income bonds today is
also convinced a lot of people—
of the same mortgage—a blanket hew first mortgage bond on a one
about 35.
The average price of
issue basis are the new bonds of
that ho matter what happens, you
mortgage on the New Haven. Now
new
first
mortgage
bonds
is
the St. Paul, which are trading
are
better off in the new- first two or three
years ago, when we

which you can¬
not escape.
Because you create
these new securities virtually for
mechanical profit

what you are

those

talking
going
dime out of it?' Frankly,

all the railroads that he is

to make

new first mortgage
is, generally speak¬

That

circuit courts, if they had the ex¬

perience

in the prewar era.

"Another

reorganization—the St. Paul, the
North Western, and so forth—is
going through as is;. because I
can't conceive
of the
Supreme
Court overruling an administra¬
tive body on some technical point
of findings which it is impossible

put in

bonds.'

Thursday, September 3, 1942

i i. v

)

,-j ;j

on

page
'

t.'l

807)

•

Volume 156

Number 4104

-

THE COMMERCIAL &
FINANCIAL CHRONICLE
807

Calendar of New Security Flotations;
!

OFFERINGS

the

the

Potomac Electric Power Co. filed
tration statement with SEC for
•

a

regis¬

mortgage

i.

Aug.

[

bonds,

series,

Building,
ington, D. C.
pany

Electric

929

E

Power

due
Com¬

Street, N.W.,

Wash¬

sale

of

electric

purchase
.these

the

bonds

has

practicable
to

Rule

publicly

proposals
curities

Offering—The

,

As

the

SEC

various

tain

York,

be

used

tures.

other

June

fixed

capital

include

installation

of

from

metal

products

ducers
at

price

of

company

Aug.

26,

5:30

bank

funds

to

loans
of

increase

now

the

that they do not.

outstanding,

Company,* were
by approxi¬

cally

V-

(8-24-42)

Aug. 31,
;

by

EWT

p.m.,

1942'

Offered—Sept. 1, 1942
Blyth & Co., Inc.
V-

Of $2,999,200
-Address—10

at

$11

Co., Smith Barney & Co. and
Blyth & Co.,
113 to yield about 2.67^ if
held to
■

..

Office

MANUFACTURING

Rheem

Manufacturing

CO.

registration

statement

85,326 shares of

Co.

Underwriting—No

with

common

i

V

has

filed

the

SEC

stock,

the

share.

per

Statement

shares

shares,

not

company
•issue

4s

plus

heretofore

be

may

for

issue

has

firm

been

its

(7-21-42)

'

at

the

Offering—Shares
net asset value,

the

as

";

at

as

July

issued

are

plus 1%.

10,

1942,

posed

Following is

price

any

upon

make-up sheet

in

the

estimating the pro¬
maximum aggregate offering price

days,
dates, unless otherwise specified,

P.M. Eastern Standard Time

as

1

The Trion

tion

Company has filed

statement

shares

of

with

includes

\

the

a

SEC

J

for

that

6,000

preferred

7%. cumulative

stock,

value $100 per share.
Address—Trion, Georgia.

at Trion,

units

and

my
no

of

beneficial

be

may

reoffered,

authorized

interest,

repurchased

together

but

not

with

and

40,000

heretofore

issued

Business—Investment trust

•••:■*

/'

*

Underwriting—Whiting, Weeks & Stubbs,
Inc., Boston, principal underwriter

Ga.

"

4

underwriters will, be named by amendment,:

Offering—The 6,000 shares registered are
and outstanding and are being of¬

.issued
fered

for the

individual

account of

a

stockholders.

Offering

price

to

At

market

with

aggregate

amount of proposed cash
offering totaling
$4,097,900,; with certain discounts allowed
large single transactions ,/.
'"y;/T;.

on
■

Proceeds—For

investment.

-

:

.

.

..

.

,

Registration Statement No, 2-5037. Form

corporation and

The

—

A-l.

be

(8-21-42).4/ .4

'paid for the stock by the underwriters and
•the
offering price to the
'•supplied by amendment. ■;

public

will

THURSDAY, SEPT. 10

be
PARK

'

Proceeds—The
ceive
go

the

net

is

not

to

proceeds, which

to the selling stockholder.
Registration Statement No. 2-5035.

8-2.
/-

of

any

registrant

(8-13-42)

Amendment

.* <•'

'•

1

•

filed Aug.. 31,

effective date.

re¬

trustees

i

Form

-

"!

-

»

NATIONAL

-

CO.

;

.

/filed
s

of

./first

ten

'■'.plan v;"V
t

$1,000,000

covering

amount

of

,

j

has

the

being/estimated-

employee's

during

Church

Street,

■

-

Insurance

is referred

•

of

capital

4'"

.

"

under

the >

amended,

voting

Co.

to

employees,

as

<

30,

agreement, V as
1942, the present
,

Registration Statement No. 2-5038. Form
(8-22-42) ,l I'V

is a

MONDAY,

.!

trust,;

the

elect

to

become

depositors under
in the fund 5'/e
but,

than

in

no

case,

$250

a

participants

MASSACHUSETTS
Massachusetts

SEPT.

INVESTORS

Investors

plan, will de¬
compensa-1
more than 5%
or

,(8-20-42)

.

TRUST

Trust

has

filed

registration statement with the SEC for
1,160,706 shares of beneficial interest with
aggregate amount of "proposed cash offer¬
$18,896,294

Address—19

,

Congress

;

;

Street,

Boston,;

.
..

Business—Investment

'

'

"

';

trust

Underwriting—Massachusetts
Distribut-1
Inc., is named principal underwriter

their

year

ors,

,

Offering—Shares offered

i

public
will

under

this

to

the

registration

general

statement

be

offered at net asset value plus 7 7c:
the offering price.
In a transaction in¬
volving $100,000 or more, the offering price

.

of

,5

WEDNESDAY, SEPT. 9

IBOND
Bond

filed

a

INVESTMENT TRUST OF AMERICA
Investment

Trust

of

America

has

registration statement with the SEC




;

14

a

the
of

Registration Statement No. 2-5036, Form
C-l.

connection

date

Mass.

tion,

in

a

"trust

after Sept.

termination

ing of

•more

par

voting trust agree-;
ment from Sept. 30, 1942, to
Sept. 30, 1947..
The voting trustees have consented
to act

ployees, who
and

$1

'v.V.vV,'.)

tfie extension pf

plan of the fund.
"The plan is a voluntary contributory em¬
ployees retirement plan under which, after
it 'becomes
effective,
those eligible
em¬

posit

stock,

••

Business—Apartmept building

with

•

certificates

Evanston,1

•

,

and

••;

statement

voting trust

F-l.

Business—Employees retirement plan
,
'. Offering—The savings and profit shar¬
ping pension fund of the Washington Na-'
tional

shares
■

Street, Inc., through

registration

a

for

will

be

net

asset

value

plus

offering price
Proceeds—For

investment

years'

to

list

is

incomplete

this

But

I

that

he

would

on

it

: You

the

For vari¬

system thrown

by

bodies

in

the

ad¬

Washing¬

bank

ratings

and

do

body

is

week)'

4%

of

.

upon

it

such

"In

with
Why?, Be¬
prices.
To

follow

whole

system is based
of where does the

the idea

bond sell.

has

to

If

be

a

bond sells at

rated

will

for
wake

into

go

up
\

of

the

some

hear

we

other

' some¬

you

so

words,

much

once

you

thing.'

B-l

par,

If

plus'

or

sys¬
bond sells

a

at

buy the St. Paul first mortgage
the equivalent of about

20

cents

the

old

incomes

might

and

bonds

are

by buying
selling the
and

commons

fact

payments
are

the

but they

to

partially

that

which is bank rating;'

in

,

to

the

only

discount
cash

I could illustrate

one

run

new

bonds, where
greater, but I

illustration is suf¬

give you

leverage.

"I have

are

are
coming and that
tremendous possibilities

that with the 'Frisco
the leverage is far

the

Haven

tremendous

depreciation.

Category?' J He said, 'That's
right.
They
are
in
B-l
plus,

New

up,

enough

think that

Well, take

and

the

that

say

ficient

B-l*

dollar

the preferred.
I have never been
offered that
opportunity before to
participate in the profit. And you

Wabash bonds

the

the

on

securities

"I spoke to a fellow a while
ago
and said, 'Don't you know that
out of the

we

able

to

there

now

days

bonds, at

of

/

olden

a

get

work.

80, it has
B-l. •/•'.'';.• T"•

the

up

idea

some

•'

/.;

-

:

'i i,;v

of
•

"

against this, too,
bonds,

first mortgage

utilities of 1935.
Your fidu¬
ciaries couldn't buy them with a
ten-foot
pole
when
they were

where I suggest, for
example, the
sale of Southern
Railway 5s at 97

selling at 55' and 60.
Remember
when the utilities of Public Serv¬
of Northern

first mortgage bonds, at 85.

Inci¬

dentally,: they have

each

.

Illinois, of West

Texas,1 and of Kentucky couldn't
be sold to the banks with a tenfoot pole.'r: Yet they were no dif¬
ferent then than they are

and the purchase of the

new

crossed

Erie

other since.
are

"Another thing is that

re-

70, it has to be rated B; other¬
wise
the rating
system
doesn't
And if it sells at

million men.

C°Uvitry haVG

did

the

ice

to

Let's look at the
thing realistically
and see what that
particular situation is
I think I have
some

fellows like yourselves

when the National
City companies sold them to us at
88.
That-is when we were al¬
lowed to get in.
Now we are

up

are

97

3'5

to

say, but
railroad labor gets the
benefit of
all these
things, and they are just
running away from the

advantage of it, then
are
being offered

organization,

better; otherwise the rating

be

not

at

convince an audience
that you've
got something,
somebody gets up
and
says, 'Well, it's all very nice
to hear what
you have to

of

Paul, 'adjures' in the 1925

St.

tem doesn't work.

to

any

—

bond

nothing,

going
day..

"I

can take ad¬
If the fiduciaries

mST+wr partlcipate m
like that!

thing

^quality,

mind, ratings are absolutely of
value, because the premium on
investment service is forecast¬

the

law
that.

defend

opportunity

^iSm ry and
public

what

bonds

take

do

down

go

and

the

surcharge

may

sug¬

one

—because you just can't sit
there

hold

those

was

to

borderline

a

have

mi-

good?

so

fiduciaries

to

as

and

I

couldn't

hate

have

couldn't

All

,

;.y;.

question.
is

bonds

didn't

He

v

bonds

yopr

'

Address—Address of trustees 18 East 48th
Street, New York City %, v''*
•

retirement

"■'-/•

Address—610

"111..

Co.

contributions

employee

years
;

Insurance

statement'with

registration

a

SEC

National

5,475

;

filed

SEC

4^4;

STREET, INC.

Offering—Registration, is

INSURANCE

-V.

.■

Washington

has

the

value

■<

TUESDAY, SEPT. 8
WASHINGTON

with
for

1942,. to defer

'.'

91 ST

Park Avenue & 91st

will
;

AVENUE. &

five

municipals, revenue bonds, utili¬
ties, and everything else.
Be¬

Address—49 Federal Street,
Boston, Mass.

•

Underwriting—Courts
&
Co.,
Atlanta,
Ga., is named principal underwriter. Other

such

not

de¬

current statistics on it
here some¬
never before
of¬ where
(looking through papers).
fered to them: and that
is, to par¬ Well, I'll give
you the statistics
ticipate on the inside of a reor¬
for the
previous year.
I have
ganization deal. A lot of
you fel- some
figures here which are true
lows are unlisted.
You know the' for
'41 as they are
true for '40
money that is made.
If you
time| only more so, which will
a
help to
reorganization right—in other
overcome the labor
argument that
words over an 18
months' pull— labor
gets everything out of the
you buy the old securities
when railroads.
In
1940, the railroads
they are kicking around for nothdid 97V2% of the
business that
mg almost, and if you know
the; they did in 1930. However the
i
® right,, that is the biggest. wage bill for the same
period was
killing that you can make for your1 down
$600,000,000.
In
other
customers and for
yourselves—in; words, in the former period
they
timing railroad reorganizations or
j employed close to two million
any
other reorganizations
right, men; in 1940
they only employed
And yet how few times
in the'about one

New

ing.
And if anything has been
100% wrong in forecasting, it has
been
the
rating on bonds—not
only on railroad bonds but on

\

outstanding to. the extent

same

thereafter

j
Business—Company
manufactures,
fin¬
ishes and
fabricates cotton goods in its
plant

the

units

par
■

issued

now

registra¬

1,544

that

the

cause

of 4:30

for 41,544 units of beneficial* interest. Total
_

COMPANY

is

when

individuals

an

Paul, Missouri

North Western

reason

these

*n'

•"

the

as

or

the exception of Erie.

.

rule 930(b).

per

|

TUESDAY, SEPT. 1
TRION

THE

planning

com¬

issuing

Therefore, who

can't

reasons, and the most impor¬

an

are as

four

me

cause

;

of

is

gesting is that he sell
buy the other.
Well,

some

income

the

they can invest
in and
what they can't invest in.
The rating agencies do not rate

Offerings will rarely be made befqre the day follow¬
ing.

defense.

selling

ratings difference between Atchi¬

$20,000,000
that railroad, so

those St.

ministrative

seven

#

!

defense.

institution

rate

(8-28-42)

son

over

coupons

or

on

upon

days ago.
These issues
grouped according to the dates on which the registra¬
tion statements will in normal course become
effective, that
is twenty days after
filing except in the case of the secur¬
ities of certain foreign public authorities which
normally
These

run

and

tant

share

per

need

ous

The quoted price
$74.98

was

payments.

ask

are

become effective in

new

intention

shares,

any
any

for

your

you

He

<

the

bonds, of course,
they couldn't possibly rate income
bonds
anything:
There are six

That automati¬

prices if they are

then

list of issues whose registration state¬

a

to

"As to income

.."Why do these securities after
they are issued sell at such low

on

filed less than twenty

were

present

for

(This

paying, and they might

three

ton

ments

no

preferred

A-l

806)

if the plan were
upset.

T:

■

the

calculated

as

incorporation

at

is

Pacific

'

'T

in

pay

interest
to

which price was used in

of

the

interest

an

that

says

Erie.

co

, ' : ;

commitment

"'•// '

time to
anti-dilution provi¬

the

articles

that

which

intends

also plans to issue and

vantage of that?

aon t

Haven

made

Registration effective 5:30 p.m. EWT
Aug. 19, 1942

additional

registered

required

by virtue of

sions ,of

notes

such

in

and

sue

What

there?

the

ultimate conversion of the
pro¬
common
shares. 1
Registration Statement No. 2-5041.
Form

rate under the.
plan, the plan hav¬
ing been upset, they will be free

pro¬

.

$1

85,326

has

them

they will have some tree
cash;to the extent of about $25,000,000. Instead of paying at the

Registration Statement No. 2-5027. Form

A-2.

a

value

par

a

interest

pay

Proceeds—For investment
RHEEM
•

com¬

in

ducers

that

price
V„"
Square, Boston,

,

Post

Business—Investment trust
take

'

"

„

the

the door for tremen¬

certainly to

share

per

Mass.,1

&

Inc. at

maturity

engaged

They

on

J';'1

40,000 shares of capital stock of
posed maximum aggregate offering

to

Loeb

statement

pany

sale

new

engage

engage.

"Here is the St. Paul at the end
of tins year with
$45,000,000 cash.

•.

5

opens

dous

.

1942

Offered—Sept. 2, 1942 by Kuhn,

The

60,000 shares of
to a group of ap¬

page

inventories

Registration—Effective

EWT

p.m.

The

offered

for

fense

Favorable Outlook Seen For
Reorganized Rails
(Continued from

indebtedness of $100,000; and the
reduce short-term bank loans.

to

other

A-2.

2.705'i

Registration—Effective
on

be

offered

to

1967, which will carry
varying from 2 to 5%

of

and

outstanding $2,910,000 of first mort¬
serial bonds,
maturing from 1944 to

gage

pro¬

shares

has

company

The new
company

have

York

New

manufacture

and

selling them.

of

In

(or

cost

$hare.

will

£0,000

be

intend

top

down

come

fin¬

stocks

statement says the

not

to

in

prop¬
old

the

in here. They are sell¬
ing at 97.
They are up from 35.
they go back to 35, then I will

that

turbo¬

int.

a

the
to

of

Mills,

Island, Virginia

Railway 5s
If

things

SCUDDER, STEVENS & CLARK FUND. INC.
Scudder, Stevens & Clark
Fund
Inc.,
tiled a registration statement with the SEC

an

$10

and
are

shares

The

of

continue

proximately 30 executives and key em¬
ployees of the old Stillwell Worsted Mills
and the 30,000 shares of
producers common

mately $2,700,000, and for capital expendi¬
tures totaling $1,400,000
,.\\;rK.i'.-r;
Registration Statement No. 2-5039, Form

(8-5-42J

to

old

located

does

business

be

Awarded—Bonds awarded Aug. 31, 1942,
to Kuhn, Loeb & Co. and
associates on bid
equivalent

now

about.

with

units and related
equipment
Registration Statement No, 2-5032. Form

112.2679,

stock

common

New

will

30,000

common

common

for

&

used to

Illinois.

dyeing and finishing

Offering—The

sheet

of

..

cluding

cloth

pany

Business—Plans to engage in business of
worsted yarn and cloth
manufacture, in¬

large

acquire

Connecticut and certain

ished

30,000

Island

cer¬

above

discharge notes

used

generator

A-2.

be

covering

$10 par value
Address—East Avenue,
Harrisville, Rhode

sheet

a

Co., Inc.,
sole underwriter

as

SEC

and

stock, $10 par value;
30,000 shares producers common
stock, $10
par
value and
60,000 shares of. common

.-'v;

Short-term

expendi¬

1942

fixed

Important

other

•••■•

made

offering
by .amendment

balance

capital expenditures for
1942 are
estimated
at
$8,691,000.
Sub¬
stantial further expenditures for such
pur¬
poses will be incurred in 1943.
The more

•

company,
statement with
the
shares of preferred

rough and finish machin¬

js named

deferred

will

company received $3,000,000 toward such purposes from the sale
of 30,000 shares of its
common stock,
The

company's

to

than

persons

erties of Stillwell Worsted
company, located in Rhode

MILLS, INC.
Mills, Inc., a newly or¬
has filed a registration

Stillwell Worsted

Co.'

generating

and

In

use

Proceeds—To

,'i

from

other

payable to Tennessee Coal, Iron & Railroad
in
amount of $126,096;
to discharge

names-of the underwriters

and

the

certain

supplied

general funds
increase company's

to

capacity

in

products

Offering—Public

se¬

■

company's

made

to

by Stillwell Worsted Mills and
subsidiaries.
Stillwell Worsted
Mills,
Inc., the new company will

STILLWELL WORSTED

Washing-;

engaged

Underwriting—Blyth

pro¬

Proceeds—Net proceeds will become
part
the

of

military

the. offering
price to the public will
be supplied by
post-effective amendment.
•

and

ing

is

stock

stock,

Building,

products

2-5040. Form

employed

ganized

amendment

presently

No.

WEDNESDAY, SEPT. 16

per share,
This statement is to

the manufacture and sale'of

military

as

and

of

It

in

extent

steel

such

metal

steel.

written

of

completed by

Statement

(8-26-42)

its

Business—Company is normally engaged
principally in the manufacture and sale of

of

soon

sealed

purchase

•.;

.

of

invite

the

v

amount

made.

U-50

to

for

•

face

A-l.

registered

ton, D. C.

the
registration
state¬
effective, the company,

become

pursuant
poses

been

after

has

ment

$5,000,000

Registration

to

par

stock/par value $1

Address—Normandy

ritory,
largely
suburban
and
rural,
in
Maryland, and interchanges electric energy
with a
neighboring utility system
t
Underwriting—No firm commitment to

,

common

be

in the District of
limited contiguous ter¬

a

stock,

preferred stock, 6% series, and
issuance and sale of the 85,326 shares

of

energy

in

and

addition

the

purpose,

registered hereunder.

Continue to be,
principally engaged in the
generation, transmission, distribution, and

Columbia

cumulative

In

common

$1'per, share,-heretofore

this

the

company is part of the
American Co.. holding company
sys¬
The
company
is,
and
intends
to

tem.

its

series.
of

cumulative

Busincss-VThe

North

shares of

5%

shares

company
estimates
that—shares of such stock will be
required
to be reserved for this
purpose by reason of
the issuance of
up to 40,000 shares of its

1977

Address—Potomac

»

3 V* %

for

of

stock,

130,000

value

$5,000,000

first

conversion

preferred

POTOMAC ELECTRIC POWER CO.

Southerh Railway 5s
selling below 90 and Erie's at

years to

that

is

when

do that.
true

of

they had

drop in '32 the
46

In other

'30

words,

and

'31, and
tremendous

that

wage bill was still

47

or

or 48% of the
gross busi¬
The railroads hgve
absolute
control of their
wage bill, more
so
than
any
industrial corpora¬
tion. But you don't hear about
it.
For the railroads are

ness.

constantly

telling

us

story, but
least

we

the

other

side

in the other side of the

it is
the

of

the

being capitalists (at
were!), are not interested
we,

story.

But

fact that the
gross controls

a

wage

bill; the

gross

business

of the railroads
controls the wage
more so now than ever.

bill,

"For example, in
^1939, for each
dollar of wages you
got about 145
ton-miles.
Now
ton-miles
is
a
unit of business of

a railroad. The
first six months this
year you got
380 ton-miles for each
dollar of

Wages have

wages.'

since then.
isn't
me

here

down!)

gone up 14%
(1 hope Mr. Whitney
or

;

he

will

•

now

.'...v.;

"In come
cases, befofe
the performance of the

knock

we

saw

railroads,

they asked me if I thought that
the Government would
take over

railroads
attorney (this was in the
during the war.
the
largest
trust Well, the Government has taken
today. company down there) came in and over the railroads. V
They have
They have all been refunded,, they said,'"My
young man, it is prima taken over the railroads, every bit
are all selling above
-of every part of the
par, and the facie evidence in a
surcharge suit,
railroads, ex¬
rating is up to where it should be if you buy a bond at 72 or
75, that cept financial; and they are not
or should have been in the
begin¬ I wouldn't be able to defend it at going to do it financially because
ning.
all. ' It would be all
right if the they are not interested in finance.
"Take your revenue bonds.
At bond were
selling at par.' Oh yes, Mr. Eastman has more power than
the end of the year
every revenue that's all'
right.
In other words, McAdoo ever had. ' Eastman has
bond worthy of' the name—Trifiduciaries are penalized.
It is every power that McAdoo ' had
borough Bridge, Henry Hudson perfectly all
and
the
Government has taken
right to buy that
Bridge, Delaware River Bridge- same bond under
over the railroads.
So you don't
exactly the same
was rated A.
A couple of weeks
have to worry about them
conditions, as long as it is selling
taking
ago
they withdrew the ratings. at par.
them over. Eastman has
complete
Now they have no
rating.
What
power over every railroad.
"Now, if they are penalized be¬
Not
do
ratings mean?
They don't cause of their restrictions, you are only that, but he has taken over
mean
anything.
Yet do you real¬ not penalized; and if
every
truck used
in
interstate
you can an¬
ize that 5,000 or more banks are
alyze these things so that you commerce and every barge line.
ruled by those
ratings; they are know what you are doing your¬ The Army has taken over the air¬

ruled bv

them

92.

over the
23 years the ratio of
wages to
gross business—the
percentage of
wages to gross business has never
varied over 1%
away from 47%,
and it hasn't taken
two or three

But the

Philadelphia,

and

satisfied with self, you can
give other individ¬
certainly am not going to uals and yourselves the benefit of
waste my time trying to
change it. I rebutted him bv saying, 'You

them.

I

the system."

•

have

over

three million Southern

lines.
the

So that except
financially,
has taken over

Government

all your

transportation agencies.

(Continued

on

page

8081*

THE COMMERCIAL & FINANCIAL

808

Thursday-, September 3r l942 i

CHRONICLE

?»

Ft. Pitt

'4*

-iL .1;?

:

.

27;Ap announcement is

under

no

circumstances to be construed as an offer of these
oj such securities.

Bridge Works

Common. &, 6s of 50}

f"

i,

'■y Penh. Central Air lines
Convertible Preferred

securitiesfor sale or as a solicitation oj an offer to buy any

Mexican External
and Internal Loans

September 1, 1942

New Issue

Cfs.

Mexican Interest Arrears

Bought-—Sold—Quoted.

$33,950,000

v'^.i

M. S. WIEN & CO.
Yj Security Dealers Ass'n

Members N.

San Antonio, Texas

HAnover 2-8780

25 Broad St., N.Y.

Due

Staff With Rollins

shown below

as

CHICAGO, ILL.

of

date of delivery
Price to

750,000

3%

1944

3

1945

3

3

850,000
875,000

P-P'

1947

3

:

825,000
'

3

2.10

1951

2.20

1952

1954

23/4

1,010,000

V

1955

2.50

23/4

1956

1,100,000

23/4

1,135,000

23/4

:
-

1958

:

2.70

23/4

j

2.70

23/4

1963

;

2.75

;

2.75

[

2.85
2.85

Louis.

;

2.90

H.

1964

23/4

1,480,000

3

1,525,000

-:;P

3

1967
1968

P.-"

3

•

3

1969

V

;

;

1972

;

2Vi%

other

have

b0en

,

identi_

fied

with
that

in

formation relating to these securities,

reference

is

made to the circular dated August 51,1942, which

purchase oj these securities and which conbiins information furnished by the Mayor of
the City of San Antonio, Texas. Copies of the circular may be obtainedfrom such of the undersigned (who arc among
the underwriters referred to in such circular) as may tegglly offer these securities under applicable securities laws.
prior to

company

'

E.

,

will

Davis

will

resident

Union Securities Corporation

Allyn and Company

■
■

i'

•;

•

•

'--i ''

Incorporated

;

Blair & Co.,

Inc.

Hornblower & Weeks

Goldman, Sachs & Co.

Blodget

Incorporated

E.

..

B. J. Van Ingen & Co. Inc.

Stranahan, Harris & Co.
Incorporated

•

.

,

•

.

'

Incorporated

^

•.

sales
.W.>'■'' • P P«

& Sons Incorpo¬
into

move

Bank

National

ing, while - in Detroit
occupy' offices in the
Building.
•
Selected
will

Investments

continue

*

Build¬

Street,
in their
St. Louis quarters in the

present

Riter & Co.

quar¬

new

week in the Field

Boatmen's

wholesaler

Pitman & Company, Inc.

;

;

ing, 135 South La Salle
Chicago, and will continue

,

Lee Higginson Corporation

Russ & Company

will

ters next

Paine, Webber, Jackson & Curtis

Eldredge & Co.

•

Mahan, Dittmar & Company

Dewar, Robertson & Pancoast

-y

Tucker, Anthony & Co.

Hemphill, Noyes & Co.

v

Rollins

H.

rated

W. C. Langley & Co.
' •.

Shields & Company

Equitable Securities Corporation i

White, Weld & Co.

:

•'

■ •:

/

'

Rollins'

as

and Harold H.

appointed

been

manager.. > <:,/ ft

Incorporated

Stone & Webster and

continue

manager,

has

Giger

E. H. Rollins & Sons

he

position

same

St.

in

Rawls

Dillon, Read & Co..

resident

Selected ." Investments,
Louis, Walter C.

with

while

A. C.

In Detroit, Ray
become

the

manager,

held

with

operation

expanded

the

in

founded

was

those to be included

the Rollins firm.

any

Investments

Selected

since

should be read

men

who

Dryden

Perry

P 104%

will be among

For further

J.

Coul-r

ter,
Drury
Sheehan
and

_

1,715,000

Alvin

Baum,

>

Milton

Price

2.65

<

Detroit and St.

;

2.90

2.60

Chicago^

are:

'

2.90

1970

V

main¬
offices

tains

2.90

1971

V P''

1,615,000

Invest¬

ed

2.85

v1966

v::-.

1,665,000

•

:

■

3

1,570,000

-''t

in

Select¬

which

ments

1965

3
3

'

V

2.55

1957

1,070,000

;

1962

1,395,000

P 2.50

.V''

3

1961

1,435,000

.

-

2.40

3

"•

cities

The

23/4

1,355,000

:

2.30

1953

3

955,000

1,040,000

-

■

West.

Middle

.

the

in

rated,

2.65

&

Incorpo¬

1,315,000

2.00

1950

3

925,000

1960

asso¬

Rollins

H.

2.65%

1,275,000

1.80

1949

3

900,000

980,000

V.,

21/2

1,240,000

1.60

1948

ciated with E.

maturity
:

1959

1,205,000

1.40

1946

August 1

P 2l/2%

$1,170,000

1.20

800,000

rate

y

Sons

1.00%

775,000

$

Due

amount

maturity

August 1

rate -

amount

Interest

Principal

yield to

Due '

become

yield to

Price to
Interest

retail sales organi¬
Selected
Investments
Company will

tember 8th, the

shown below

zation

Principal

Announce¬

—

made that effective Sep¬

is

ment

.vH

plus accrued interest from August 1, 1942 to

P

Selected Inv. Sales

Dated August 1, 1942

as

1-1397

Y.

N.

Teletype

Electric and Gas Revenue Bonds

Prices

,

-

Build¬

they will
Penobscot
Company

and

sponsor

as

of Selected American

portfolio will

Shares, Inc., whose

management of
Security Supervisors, Inc., invest¬

remain under the

ment advisors.
E.

Favorable Outlook Seen For

Reorganized Rails

right along, and it is going to

(Continued from page 807)
V "Eastman can do anything that
he wants to.
He can stop the

it

running
Twin Cit¬
ies and let the St. Paul handle it.

possibly help railroads of the bor¬
derline type is the part of the tax
bill which,. I believe, will be in
there to authorize and allow rail¬

North

from

Western

trains to Milwaukee and

be in the tax

thing

merchandising.
"If you take

ideas to the public,

will, in my opinion, be mer¬
chandising something. You are
merchandising those ideas.
De¬

you

bill.

'Another

dising, but you get paid for your

which

might

spite the fact that you can't sta¬
bilize the market and all that sort

of thing, I think your idea will be
worth its hire from anybody with
bonds at a discount
yet, but he can do it. He has is¬
any reasonable judgment. For the
sued his orders,
and they will and not to pay a tax on the dis¬
count.
But how much of an ef¬ competition in ideas is not too
obey them, and they are going to
keen these days. How many ideas
fect it will have, I don't know, be¬
obey them too.
So you have no
can
you develop?
There aren't
cause I think all your borderline
government bugaboo because
too many.
Outside of your spe¬
railroads will be buying the shortEastman has taken over the rail¬
cial offerings, it sometimes amazes
term maturities rather than the
roads—every function of the rail¬
me
why people, will buy steel
roads except financial; and he is long-term ones.
with a 45 cent commission when
not going to do that. Why should
"Well, to close the general dis¬
they won't buy it when the com¬
he? ' •
;■ cussion, I shall simply try to leave
mission is 6 cents.
But I think
"As you know, Allegheny spent with this audience, whether you
that we in the financial business

He

gotten around to that

hasn't

roads to buy

.

.

thousands of dollars all over the

opposing the
the basis
that the tax base for the excess of
States

United

in

Missouri Pacific plan on

the
par

companies would be the

new

value of bonds plus the mar¬
Yesterday the

ket value of stocks.

Finance

Senate
ceived

joint

a

Committee

re¬

recommendation
and the Joint

from the Treasury,

Committee

stated the rule under

will use the old base
corporation, which just

which they
for

new

kills the

argument.

We expected




anything
else, the faet that we either have
to merchandise ideas in something

are

listed

or

unlisted

that somebody
have

we

to

or

some¬

be sold. Why? Because
they are giving you a
commission so that you make a
living out of it. That is why these

ings

can

effect

offerings

or we

go over.

It is merchan¬

in

thing.
The spread
securities is not too

railroad

cago,

and out of these

fices

operates' more than thirty
The operation of

has been
and unlisted
departments of the listed houses
to go out and try it.
But those

Rollins in the Middle West will
been very continue under the direction of
successful—and they didn't know Perry Dryden, a Vice-President
and Director of the corporation.
a rail from a bale of hay before

they started. So don't think it is
complicated. It is a specialty. But
once

you

know

one,

you

'know

them all."
The

railroad

forum, conducted

Mr. McGinnis was well at¬
tended, several railroad officials
being present in addition to; the
traders
and
their
guests from
various

organizations outside the

securities field.

The commission
straight.
members.

is

for -$1,000.

$2.50

a

bond

A lot of you fellows are

I'm

sure

that

if

you

Newburger & Hano
Hano announce
Baltimore of¬
fice to the Keyser Building, and
the association with their Balti¬
more
investment department of
Thomas
H.
Sherman,
formerly

George Nelson Joins

Street, New York City.;
members of the New York Stock

40

Wall

&

Newburger

the removal of their

with

Robertson & Co. Staff

Francisco's

T. H. Sherman With

by

George Nelson has become asso¬
ciated with Robertson & Company,

Louis-San

branch offices.

who have tried it have

and buy 2%
New Havens for $1,000, and you
can go out and buy almost 7
St.
You can go out

major of¬

My greatest difficulty

but the spread in propor¬
to the money invested is not

bad.

Sons Incorpo¬

get unlisted boys

wide;
tion

&

to

ideas

more

Rollins

it.

won't be in it very long.

"One

else hasn't got or

merchandise

thing with a spread in it. Other¬
wise it is virtually impossible for
us
to make a living.
We have
found out that these special offer¬
in

must either merchandise our

H.

out and sell ideas like this to a rated maintain major offices in
customer, he is going to give you New York, Boston, Philadelphia
and San Francisco, as well as Chi¬
a reasonable commission on top of

go

Mackubin, Legg & Co.

•

;

\

The

Harrisburg, Pa., office of
Newburger & Hano has been re¬
moved to the Blackstone Building
and

will

under

be

ment of Ray

with

him

John

L.

the

E. Taylor.

in

this

Costello:

manage¬

Associated

office

w.ill be
•

Charles Euler has become

asso¬

Mr. Nelson formerly ciated with the firm's main office
was
a partner
in George Nelson in Philadelphia, Pa., 1419 Walnut
;;P:
& Go. for many .years.,
I, •' Street.
Exchange.