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Vol. 6 No. 29
Des Moines, Iowa
November 14,1977
Burns: Tax Cut Would Aid Entire Economy
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A vigorous call for strong,
immediate measures that would
em phasize the
im portant u n
derpinnings o f
p rofits to the
American econo
my was issued
by Federal Re
serve B oa rd
C h a irm a n A r thur F. Bums in
a recent major
speech. AddresA. F. BURNS
sing the Gonzaga University 1977
Founder’s Day in Spokane, Wash.,
Chairman Bums said that a feature
of our current economic environ
ment that could be a barrier to full
employment is “ the fact that the
profits being earned by American
business are at an unsatisfactory
level.”
The current expansion, he noted,
“ has been marked by notably
weaker investment spending than
was ch aracteristic o f previous
recoveries.” He attributes the lack
of real capital outlays for major
industrial construction projects to
the fact that businessmen can see
the weakness of profits after the
“ fluff” of inflation is skimmed off
the top of profits on which they
have to pay taxes. These after-tax,
after-inflation profits, Chairman
Burns stated , were in 1975
“ consistently below the levels
reached during 1965-67.”
In 1976, he said, Commerce
Department estimates show that
the replacement cost of inventories
used by non-financial institutions
exceeded b y $14 billion the
materials expenses claimed for tax
purposes. Similarly, the amount by
which depreciation charges fell
short of the replacement cost of the
capital assets consum ed was
“ nearly $36 billion, making a
combined understatement of costs
from these two sources $50 billion
in 1976.”
Dr. Burns said “ beyond the
critical fact that corporate earnings
are discouragingly low” are these
important conditioning influences:
A strong residue of caution in
businessmen’s thinking has carried
over from the recession of 1974-75.
A lingering sense of unease
produced by the severity of the
recession has been deepened by the
sluggishness of the subsequent
recovery in much of the world
economy outside the United States.
The specter of serious inflation
continues to haunt the entire
business community.
Businessmen have had great
difficulty in evaluating the implica
tions of the major policy initiatives
being considered this year.
Chairman Bums drew distinct
parallels between the weakness of
capital expansion in the late 1950s
and early 1960s with 1973 and
tod a y , statin g that in those
previous periods “ a phase of
deep-seated economic malaise had
set in, with worry voiced that
sluggishness in business invest
ment might well prevent the
economy from attaining full em
ploym ent. The parallels w ith
today...are close in many respects,
the major differences being that
profit rates were not as low then,
nor was inflation com parably
troublesome.”
In response to those conditions,
he recalled, President Kennedy
developed an innovative tax device
— the investm ent tax credit
through the Revenue Act of 1962.
Significantly liberalized Treasury
depreciation rules followed, along
with broadly based income tax
reductions both for businesses and
individuals in the Revenue A ct of
1964. Chairman Bums compared
those conditions with the ones of
today and said it is “ worth recalling
those actions had the consequence
of strengthening dramatically both
investment activity and the general
economy.”
If such a positive approach was
adopted today, he flatly stated, “ I
for one would have little doubt
about our economy’s capacity to
shake off its malaise.” This would
not be the sole answer, he said, but
would certainly stimulate business
investment in new plant and
equipment, leading to more em
ployment.
[Turn to page 7, please]
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McIntyre Bill Permits
EFT Across State Lines
Sen. Thom as J. M cIn tyre
(D.,N.H .) has introduced a bill that
would give all federally chartered
financial institutions authority to
go across state lines and nationwide
with their electronic funds transfer
systems and terminals. The bill
would be effective January 1, 1980,
and include authority to accept
deposits. Hearings, Sen. McIntyre
states, will be held early next year.
Washington observers say passage
of the bill is unlikely.
Credit Unions
Issue VISA Cards
An experimented program en
abling nine federal and 14 statechartered credit unions to issue
V ISA cards to their members
began recently and is expected to
develop into a nationwide credit
Call your roving
correspondent
at Bankers Trust
holding company by
Delhi Savings Bank.
Call me
to ll fre e . . .
800-332-5991
A good
correspondent mM
bank r e la t io n s h ip S ^ ^ ^
is still b u ilt |
by good people. I
Yours and ours.
ELM A: Peoples Savings Bank has
received consent to exercise limited
trust powers.
Merchants
jfle
National Bank 181
C e d a r R apids. Io w a 52 4 0 1
acquiring
A 'B A N K S O F IO W A * B A N K
card-issuing program for credit
unions.
The offering of credit cards to
their members is an interim step in
the goal of credit unions to issue
plastic transaction cards, for use as
either credit or debit cards, for
entry into automated teller ma
chines, or for identification pur
poses.
Extend Truth in Lending
Comment to December 6
The comment period for uniform
guidelines for the enforcement of
the Truth in Lending law and its
regulatory rules has been extended
for 15 days, to December 6, 1977, it
was announced recently by the five
federal agencies that regulate
banks, thrifts and credit unions.
Iowa News
D A V E N P O R T : The Southeast
Iow a G roup o f the N ational
Association of Bank Women will
meet Thursday, Nov. 17, at the
Davenport Country Club. The
m eeting w ill be coh osted b y
LeClaire State Bank and the
Farmers Savings Bank, Princeton.
The morning session will be a
business meeting, and will be
followed by an afternoon program
on computer processing.
DELHI: The Board of Governors of
the Federal Reserve System has
announced its denial o f the
application of First of Iowa Bank
Shares, Inc., here to become a bank
M ARSHALLTOW N: Richard K.
Isaacson has been named farm
manager for Security Savings
B ank’ s trust departm ent. He
formerly was a professional farm
manager and rural appraiser for
Hertz Farm Management, Inc.,
Nevada.
MUSCATINE: Leland Hanson,
assistant cashier of Central State
Bank, has been appointed manager
of the instalment loan department.
SOLON: Doug Stahle has joined
the Solon State Bank as officer
trainee. He is a recent graduate of
Luther College in Decorah.
STANTON: Bill Grotenhuis, chair
man of Security State Bank, is in
Nebraska Methodist Hospital, 8303
Dodge St., Omaha, Nebr. 68114,
undergoing surgery for aneurysms.
He is expected to be in the hospital
another one or two weeks.
Nebraska News
The Nebraska legislature’s bank
ing and agricultural committees
will jointly sponsor L.B. 258 when
the legislature convenes in Janu
ary. The bill, supported by the
N ebraska Bankers A ssocia tion ,
would double and perhaps triple the
investment in Nebraska banks of
short term state funds under the
jurisdiction of the state investment
council. Presently, under authority
voted last session, those funds
amount to about $50 million on
deposit in Nebraska banks. Dou
bling that total would make that
much more available in loans,
especially for Nebraska’s critical
agricultural industry. These facts
were brought out in a special
hearing conducted November 4 in
Lincoln by the legislative commit
tees in cooperation with the Federal
When your customer owns equipment but needs cash, perhaps a
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BANKERS TRUST
Des Moines, Iowa 50304
Use our to ll-fre e WATS line: 800-362-1688
F.D.I.C./Federal Reserve System
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Federal Reserve Bank of St. Louis
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“ DICK” SELLON
545 - 31 st Street • 282-5008
Des Moines, Iowa 50312
‘DUANE” DEVAULT
C
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INVESTMENT SEC UR ITIES
TELEPHONE
2SS-2I52
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* NEW ISSUE
MOODY’S:
S&P:
“Aaa”
“AAA”
$3,460,000
DES MOINES, IOWA
General Obligation Bonds
(Part of an issue of $4,000,000)
Dated:
December 1,1977
Denomination:
$5,000
Both principal and semiannual interest (June 1 and December 1, first coupon due June 1,1978) payable at the
office of the City Treasurer, Des Moines, Iowa.
IN THE OPINION OF COÜNSEL INTEREST ON THESE BONDS IS EXEMPT FROM ALL PRESENT FEDERAL
INCOME TAXES, IOWA FRANCHISE TAX AND ALL PROPERTY TAXATION IN THE STATE OF IOWA.
MATURITIES
4.25%
$200,000 June 1, 1980
4.40%
300,000 June 1, 1981
300,000 June 1, 1982
300,000 June 1, 1983
300,000 June 1, 1984
#
3.75
3.85
3.95
4.05
4.15
4.40%
June 1, 1985
June 1, 1986
June 1, 1987
June 1, 1988
4.50%
370,000 June 1, 1989
500,000 June 1, 1990
$390,000
-0 400,000
400,000
4.25
N/R
4.45
4.50
4.55
4.65
LEGALITY TO BE APPROVED BY AHLERS, COONEY, DORWEILER, HAYNIE & SMITH, ATTORNEYS,
DES MOINES, IOWA
Des Moines is the capital of the State of Iowa and also the county seat of Polk County. Since its incorporation in 1851, it has served as
the commercial, industrial, governmental and financial center of the State. Des Moines is the home of Drake University (enrollment
5,800), Grand View Junior College (enrollment 1,600) and several other smaller colleges and business schools. Des Moines is an
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important insurance center with 58 home offices located in the City. The largest is Bankers Life Company with 1,860 employees. Also,
important is the printing and publishing industry; the largest employer in this category is Meredith Corporation who employ 2,426 in the
printing of Better Homes and Gardens and other periodicals. Besides insurance and publishing, there are an estimated 400 factories in
the area with combined sales in excess of $500,000,000. Major industrial employers in the area include John Deere (farm equipment,
2,800 employees); Firestone Tire (tires, 2,200 employees); and Pioneer HyBred Seed Co. (seeds, 1,400 employees). Large commercial
employers located in Des Moines include Northwestern Bell Telephone (2,700 employees); Younkers Department Stores (2,440
4 ) employees) and Iowa Power & Light Co. (1,360 employees). In addition, it is estimated that the various levels of government provide
employment to 16,500 people in the area. The population according to the 1970 Census was 201,404 and is presently estimated at
202,800. Des Moines is served by four airlines, seven railroads and 46 truck lines. Interstate highway No. 35 and 80 intersect in Des
Moines. The area included within the City’s limits is about 65 square miles.
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These bonds are being issued under the provisions of Chapter 384, Code of Iowa, 1977, as amended, to defray costs of the 1977-78
Capital Improvement Program. In the opinion of counsel, these bonds are legal and binding general obligations of Des Moines, Iowa,
and all taxable property located therein is subject to the levy of sufficient taxes to pay the principal of and interest on the bonds without
lim it as to rate or amount.
FINANCIAL STATEMENT
Actual and assessed value of taxable property, 1976-77
Direct debt, including this issue
Total direct and overlapping debt
Population, 1977 estimate:
$2,201,268,030
48,875,000
67,872,650
202,800
Direct debt per capita: $241.00
Total debt per capita:
334.68
Tax collections have approximated 99.2% of taxes levied for the past five years.
We own and offer subject to prior sale and change in price and subject to our attorney’s approving opinion.
The information contained in this circular is not guaranteed, but is derived from sources we deem reliable
and is that on which our purchase of these bonds was based. Offered subject to prior sale and change in price.
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FIRST NATIONAL LINCOLN
13th & M Street • Lincoln, Nebraska 68501 • Member, F.D.I.C.
Reserve Bank of Kansas City. Ed
Harshbarger, research officer and
economist from the Fed, provided
the statistical input from his
o ffic e ’ s latest survey o f ag
conditions in Nebraska and the rest
of the 10th District.
deposit insurance has been ap
proved.
ASHLAND: Ashland State Bank’s
application for federal deposit
insurance has been approved.
ELK GROVE: Kathy Sicher has
been promoted from loan supervi
sor to assistant cashier of Suburban
National Bank.
GOTHENBURG: First State Bank
has received permission to establish
a detached tellers’ facility at 605
10th Street.
H E N D E R SO N : Steve M ichel,
cashier of the Henderson State
Bank, has been elected to the
board. He replaces the late
M aynard G rosshans who had
served on the board since 1945.
YORK: Harold Oxley is the new
instalment loan officer at York
State Bank and Trust Company.
He form erly was with A v co
Financial Services as manager.
Illinois News
•
The following banks have re
ceived consent to establish a
facility: South Chicago Savings
Bank, at 9250 South Chicago
Avenue; East Joliet Bank, at
Briggs Street and New Lenox
Road; and West Suburban Bank,
Lombard, at 33 East St. Charles
Road, Villa Park.
0
BLOOMINGTON: Prairie State
Bank’s application for consent to
exercise limited trust powers has
been approved.
•
.
CHANNAHON: First Bank of
Channahon’s application for federal
CHICAGO: Colonial Bank and
T rust Com pany has received
consent to exercise limited trust
powers.
LAW NDALE: Community Bank
has announced a series of executive
changes. The post of president was
merged with chairman and chief
executive officer and continues to
be held by Cecil C. Butler. James
T. Hadley was named senior vice
president, Lawrence D. Covington
vice president and cashier, and
Donald D. Ford vice president.
Minnesota News
The Minnesota Bankers Associa
tion will present its first annual
Security Conference M ondayWednesday, Nov. 14-16, at the
Radisson South Hotel in Blooming
ton. Registration will be held from
3-7 p.m. on Monday.
BROWNS VALLEY: Joe Doblar
has joined the Union State Bank.
His prior banking experience
includes an association with the
United National Bank of South
Dakota, Sioux Falls.
CANNON FALLS: Gerri CaUstrom
has been promoted from head teller
to assistant cashier of Security
State Bank.
DULUTH: Miller Hill State Bank’s
application for federal deposit
insurance has been approved.
MINNEAPOLIS: First Plymouth
National Bank has announced the
promotions of Mildred Gilbert to
personal banking officer and J. L.
Gaulden to marketing officer.
ST. PAUL: Northwestern National
Bank has elected Jeanne Fogelberg
to banking officer. She will be
assistant manager of the bank’s
new North Suburban office in
Arden Hills.
Colorado News
PARKER: Bank of the W est’s
application for federal deposit
insurance has been approved.
South Dakota News
ABERDEEN: Gary W . Peterson
has been named vice president and
marketing officer of Aberdeen
National Bank. He joined the bank
in 1966.
North Dakota News
GRAFTON: R. S. (Reich) Reichert
has been elected vice president of
the Walsh County Bank and Trust
Company. He is manager of the
Hoople Office.
Wyoming News
CHEYENNE: Betty M. Oyler has
been promoted to operations officer
at the American National Bank.
BURNS .............................................
[Continued from page 1]
He concluded by saying, “ I
cannot overstate the importance of
unwinding the inflation that is
continuing to plague our economy.
There is a paramount need for
COULSON
CANNON
AND LEWIS
Three o f o u r men on yo u r side at
Fred N. C oulson, Jr.
234-2479
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Federal Reserve Bank of St. Louis
Tom C. Cannon
234-2481
Edwin B. Lewis
234-2625
Commerce Bank o f Kansas a ty
Member FDIC
Telephone (816) 234-2000 /
avoiding new cost-raising measures
by government, of which the
recently legislated increase of the
minimum wage is only the most
recent very troublesome example.
Fiscal and monetary policies need
to be conducted in ways that will
quiet, rather than heighten, infla
tionary expectations. On the fiscal
side, this means that great caution
will have to be observed both in
giving up tax revenues and in
program initiatives entailing new
expenditures.
“ On the monetary side, I want to
assure you that we at the Federal
Reserve fully appreciate the critical
linkage between money creation
and inflation. We have no intention
of letting the money supply grow at
a rate that will add fuel to the fires
of inflation. On the contrary, we are
determined to bring about a
gradual reduction in the rate of
m oney expansion to a pace
compatible with reasonable price
stability.”
The latter objective can be
achieved, Dr. Bums emphasized,
“ if the Federal Reserve retains, as I
expect it will, the independence
from political pressures on which
the Congress has so wisely insisted
across the decades.” (Ed. Note: A
week later, the Senate killed the
House proposal for the President to
Estate Appraisals
Purchase of Collections
choose his own Fed Chairman after
Sen. William Proxmire, D ., W is.,
argued that the Fed must be
independent of the White House.)
Chairman Bums concluded by
saying, “ We at the Federal Reserve
always welcome advice on how best
to proceed. Ours, however, is the
resp on sib ility to act in the
monetary area, and we intend to
exercise that responsibility in ways
that promote the long-run, as well
as the immediate interests, of this
Nation.”
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Ben E. Marlenee Coins
913 Locust
Des Moines, Iowa 50309
515-243-8064
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AFFILIATED WITH CENTRAL NATIONAL BANCSHARES, INC.
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LEASE OR SALE
WANTED
Burroughs F 6200 Sensi-matic posting machine.
Contact John E. Dencklau, Farmers Savings Bank,
Vincent, IA 50594. Phone 515-356-4912.
LET US SELL YOUR BANK
SPECIALISTS IN VALUING & SELLING
BANKS SINCE 1959. FORMER BANK
EXAMINER & BANKER. Ray E. Reents,
2730 S. MacArthur, Springfield, III.
62704.
Fully equipped, 1000 sq. ft. double-wide trailer for
aux. banking facility. Has 2 officer, 2 restrooms,
night depository, drive-in window, coin chests, coin
counter and wrapper, camera and alarm system, and
much more. Available w ithin 30 days. Contact Bob
Blank, Cornhusker Bank of Omaha, 90th & Bedford,
Omaha, Nebraska - 402-571-2300.
ESTATE APPRAISALS
ESTATE PURCHASES
ESTATE SALES
PHONE 402-397-2767
AKSARBEN STAMP AND COIN
10817 PRAIRIE BROOK RD.
OMAHA, NE. 68144
Correspondent Bank Department s m irfm Wm.
6 K
Charles E. Walters Co., Inc.
P.O. Box 1313. Omaha, Nebraska 68101
Phone: (4 0 2 )5 5 3 -6 4 0 0
14’ x 60’ preconstructed commercial bank bldg.,
equipped with drive-up window, inside tellers,
depository, currency chest, and desk. Also 4
different types of constructed buildings available in
various sizes. SON CORPORATION, Box 684,
Wichita, KS 67201 - 316/942-8167.
Toll free 800-362-1615
DES MOINES, IOWA
POSITION AVAILABLE
Experienced commercial loan officer for over $50
m illion southern Minnesota bank. Community
population over 25,000. Ag and installment lending
experience helpful. Send resume and salary history
to Box AAO, c /o NORTHWESTERN BANKER, 306 15th St., Des Moines, IA 50309.
Please Contact: J. Mason Henry,
President
Call on u s !n > tp ;{w
Central National Bank & Trust Company
Contact: Russ Plager
5832 Harwood Dr.
Des Moines, Iowa 50312
Phone 515/279-7445.
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FOR LEASE
Sale of Rare Coins
Interested in Iowa Bankers
People/People Tour to
Europe and Russia
EDDIE A.
WOLF
CAPITAL PERSONNEL SERVICE
2 0 4 Securities Bldg.
5 1 5 -2 8 3 - 2 5 4 5
Des M oines, Iowa 5 0 3 0 9
BANKING CAREERS
If you are currently employed and wish to evaluate
your career potential, my organization has openings
in the $12,000 to $40,000 range in banks throughout
the Midwest. All positions are employer paid. Call or
write Jim Hogan fo ra confidential appraisal: Dunhill,
Suite 1135, 7302nd Ave. S., Minneapolis, MN 55402 612/335-6451.
FOR SALE
Teller machines, NCR three total, two new units,
cash in, cash out, and adding machine. These are not
electronic machines. In Iowa, call 1-800-392-5680,
Robert Grathwohl, United Home Bank, Mason City,
Iowa 50401.
POSITIONS AVAILABLE
JUNIOR OFFICER— Kansas bank of $5MM
seeks cashier with instalment loan
experience. Opportunity to become part
of senior management..........................$12-$15,000
TRUST OFFICER— Rural bank of $30MM with
excellent growth potential in trust area.
Ag background desirable............................ $22,000
PLATFORM OFFICER— Missouri bank of
$12MM needs #2, with good operations
background. W ill handle most cashier
d u tie s ............................................................$15,000
DATA PROCESSING— Head operations of
data processing dept, fo r large midwestern bank. R espo nsible fo r three
s h if t s ........................................................... $20,000
TOM HAGAN & ASSOCIATES
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WILLIAM B.
GREAVES
SERVING PROFESSIONALLY
Bonking, Financial & Business Personnel
Iowa and Nationwide
RICHARD
BRO
RAYMOND
SCHNEIDER
Box 12346, 208 E. 18th Ave.
N KC, MO 64116 (816) 474-6874
“IT TAKES A BANKER TO KNOW ONE“
Vol. 6 No. 29 Northwestern Banker Newsletter is published weekly by the Northwestern Banker Company, 306 Fifteenth Street,
Des Moines, Iowa 50309. Subscriptions 25 cents per copy, $6 per year. Second class postage paid at Des Moines, Iowa. Address all
Digitized
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