The Los Angeles Times from Los Angeles, California • 49

-f -r 'V 1 Market Suffers Sharpest Loss in 7 Weeks p. ins ness 111 TUESDAY MORNING, DECEMBER 11, 1962 'Part lil in no Sugar Up, Aluminum Down in Flurry of Price Changes Profit-Taking and Tax Selling Blamed as Averages Drop BY ROBERT SULLIVAN Assistant Financial Editor of The Times A number of little things undermined the stock market Monday as prices took their sharpest drop in about seven weeks. It was obvious from the opening that all was not well, but brokers found it SUGAR IS UP and aluminum la down In a flurry of price changes announced in the past several days by producers of six major commodities. American Sugar Refining Co. hiked prices 10 cents a 100 lb.

on all types of industrial and consumer packaged sugar. Another large supplier, National Sugar Refining posted" a similar boost on specialty types of industrial sugars used in soft drinks, taking and canning. The increases. which may be linked to the threat of a longshoremen's strike, bring refined sugar prices close to their highest levels in nearly 40 years. The nation's top three aluminum pro The Markets in Brief THE BIG BOARD Hok shares traded; 13 nrw VMi highs; 2 new lows.

Dow Jones 30 industrials: 645.08, off 7.02. Bonds $5,670,000 galea. Dow Jones 40 bonds: 87.51, up 0.01. AM EX Stocks 1,430,000 shares traded. Bonds $100,000 sales.

COMMODITIES Dow Jones spot Index advanced 6.23 to 148.37; futures index closed at 144.2'J, off 0.10. difficult to diagnose tha trouble. In the absence of bad eco nomic news, market analysts attributed the day's setback to: (1) traders who bought during the big decline six months ago and who were cashing in capital gains; (2) TRANSPORTER To move the gigantic S-IV second stage vehicle of the Saturn C-l missile to Cape Canaveral, Douglas Aircraft Co. built transporter with Goodyear Terra-Tires to eliminate the need for spring suspension. Dwarfed are N.

J. Baszt, left, of Douglas, H. F. Webb of Goodyear Tire Or Rubber Co. traders taking fast profits following the sharp rally of the last six weeks and (3) in vestors establishing year- end losses for income tax.

purposes. This combination knocked Retail Sales 1 Increase 2 the Standard Poor's 500-stock index down 0.79 to Good Year but No Boom Seen by U.S. Chamber Automobile Sales, Capital Spending Bright Spots in Forecast; Construction Uncertain Manufacturers Expect Modest Rise in Sales 62.27. The Dow Jones industrial average dropped 7.02 to 645.08. in November Steady Pressure Steady pressure through WASHINGTON OP Re out the day cut a broad swath through the list.

Of the 1,320 issues traded on WASHINGTON (UPI) Paul Herzog, director of re search for the National Au WASHINGTON (UPI) The Commerce Department reported that manufacturers tail sales in to President Ladd Plumley of the Big Board, 944 dropped taled $20.8 billion, a 2 in tomobile Dealers Associa-I in price while only 200 man expect a modest sales gain of $500 million in the first crease from October and 5 tion, said auto manufactur the U.S. Chamber of Commerce Monday forecast "a good but not boom year" for business in 1963. He said above November of last ers next year might "contradict the unwritten tradi three months of 1963 and some further accumulation of inventories. year, the Commerce Depart ducers, Alcoa, Reynolds and Kaiser, lowered prices 1.5 cents a lb. on basic ingot and 1.6 cents on semi-finished aluminum'.

The reductions brought U.S. prices in line with those of the world market. In another reduction, U.S. Steel cut prices for hot and cold rolled carbon sheets produced at its Fairless (Pa.) plant. -The other changes were all on the upside.

Armstrong Cork, which had lowered prices on its asphalt tile by 3 last May, announced hikes of 4 effective Feb. 1. The Bridgeport Brass division of National Distillers Chemical Corp. raised the base price of copper and all alloys of sheet and strip by Va cent a lb. Increased costs were given as the reason.

Arid two brass mills, Scovill and Cerro, reduced by 2 cents a lb. the price they pay for brass and other mill scrap returned by customers. The change amounts to a price increase. Other brass mills indicate they don't plan to follow suit. JACK SEARLES INVESTMENT: Despite the market's gyrations, mutual fund buying increases MUTUAL FUNDS have more investors' today than ever, despite the stock market's recent ups and downs.

Mutual fund members of the Investment Co. Institute report a current total of 6 million shareholder accounts. These accounts, both individual and institutional, compare with of 5.3 million a year ago. Investors will buy $2.7 billion in mutual fund shares in 1962, the institute estimates, against $3 billion in 1961. Redemption of fund shares this year should total $1.1 billion vs.

$1.7 billion last year. The estimated combined assets of the institute's 170 members is expected to total $20 billion at year-end. This compares with assets of $22.8 billion at the end of 19G1. ment announced Monday. tion that the automobile re there were many uncertain The department based its The gain was disclosed in tailing cannot en ties clouding the economic the department's so-called picture.

aged to show gains. There were 176 unchanged. Turnover was a better-than-average 4.27 million shares on the New York Stock Exchange but trading was orderly and only twice during the day did the ticker tape run slightly behind transactions. Of the 15 most active issues on the NYSE, 14 declined and one, Alleghany projections on a survey made in November. The results indicated that firms expect the slow rate of flash" report on retail ac Plumley, in a speech pre tivity, a preliminary survey pared for the chamber's an made in advance of the expansion in manufacturing sales since last winter to joy two good years in a The industry currently is heading for its second best sales year in history.

Herzog said government studies of consumer buying intentions forecast an in broader study which re nual business outlook con quires a month in prepara ference, said the administra tion. continue, with neither i slump nor a vigorous expan sion on the horizon. tion's proposed 1963 tax cut The report showed that "could go a long way to hales were estimated at crease in automobile sales itini ward restoring more satisfactory economic growth." the fall pickup in retail sales volume, noted in October, was extended and improved in the past month. next year. He predicted! SV 'WZ V.

1UUII bill However, another confer months of 1962. a new manufacturers would sell about 50,000 more cars than The gain was limited al quarterly high. The figure ence speaker expressed most entirely to non-dur the 6,850,000 expected to S500 million more than rose Va to 11. Polaroid Leader The most active issue of the day was Polaroid. After being ahead most of the day, it could not resist in the end the general market trend and sold off at 138V4 as 70,800 shares changed hands.

Its popularity was caused by anticipation of favorable news about the company's able goods. Despite the exceptional strength in auto in juiy, Augusi ana September. An equal gain is anticipated for January, doubt that Congress would approve the tax reduction in time to have any significant effect on the nation's economic vitality next year.t Dr. Leslie Peacock, sen sold this year. Irwin H.

Such, vice presi-denUof-lhe-Penton Publishing Co. of Cleveland, estimated that more than $38 mobile sales, durable goods retailers as a group showed no improvement from the high October sales volume. double the 1917-49 base while material prices, at 130 on the cost index, are actually one point lower than in the 1956-53 period. AUTOS: Chevrolet, Ford's Gotoxie and Rambler lead the popularity parade U.S. AUTOMAKERS will turn out their 200 millionth vehicle today.

Here's how the top 10 rate in order of popularity at this milestone: Chevrolet, Ford Galaxie, Rambler, Pontiac, Ford Fairlane, Falcon, Chevy II, Oldsmobile, Corvair and Buick. Six of the top 10 are General Motors products, three are from Ford and the other, Rambler, is from American Motors. The top 10 rankings include two new-comers, Ford Fairlane and Chevy II, which weren't in full production last year. They replace Plymouth and Comet Falcon and Corvair, both compacts, are the only members of the top 10 which have failed this year to match their 1961 production totals. Both were cut back to make room for larger entries from their companies.

AGRICULTURE: Increased automation seen key to state's competitive position CALIFORNIA remains the nation's No. 1 farm state with cash receipts of $3.25 billion last year. The state's farmers probably will resort to increased automation (i.e., sophisticated crop-picking machines) to meet the competitive threat of the European Common Market, according to Business Week. Importance of the state's farm output is underscored by Council of California Growers statistics: We grow more than 40 of the nation's fruits and vegetables; every fourth head of lettuce sold in the United States is grown in the Salinas area. ET CETERA: Random curiosities, facts and rumors from today's business world STREET REPORTT Brush Beryllium Corp.

"has a chance" of earning 12 cents to 15 cents a share on sales of $6 million to $7 million in the fourth quarter, according to George S. Milhalapov, president. The company earned an indicated $51,000, or 2 cents a share, on sales of $6.1 million a year earlier Motorola sales this year will set a record, Edward R. Taylor, president of the company's consumer products subsidiary, predicts. He says sales of Motorola TV sets now are about 50 ahead of 1961 after reversing a declining sales trend earlier this fall Municipal bond prices continue to reflect a lack of buying enthusiasm as the number of bonds offered in the national and California markets increases, William R.

Staats Co. reports Quote from Standard Poor's Outlook: "Growing confidence, improved business prospects and the reawakening interest of the investing public could lead in time to still higher share prices. A technical correction is possible but this would be regarded as another buying IN PASSING: John Hancock Mutual Life Insurance Co. set aside the highest dividend allocation in its 100-year history $117.4 million for payment to policy holders in 1963 More than half the world's total oil refining capacity (53.4) is owned by U.S. interests At latest count, there were 91,185 local governments in this country.

This includes school districts and 56,507 other units, such as counties, municipalities and Non-durable sales rose 3. color film. eDruary ana March, 1363, the department said. Nondurable! Rise The October March estimated rise centers in the nondurable goods industries, the report said. Sales in ior economist for the Amer billion would be spent for The "flash" report cov new plants and equipment in 1963.

This would be a ered a cross section of about 2,000 retail firms which op ican Bankers Association, said the expected stimulant for business would be a long- erate 40,000 stores. The figures are subject to re vision when the larger sampling is completed, but the revision seldom is large. slight increase over the anticipated total for 19G2. Pattern to Continue The steel industry can expect 1963 to follow the pattern of the past five years in which less than 100 million these lines were estimated at $52 billion, seasonally adjusted, for the closing quarter of 1962 and $52.5 billion for the first quarter of 1963. Among soft goods producers, chemicals and oil firms locked for the best relative range proposition occurring some time after the tax rates are dropped.

Prospects Cloudy Plumley said that without the tax cuts, business prospects for 1963 would be The figures were adjust ed for seasonal variations and differences in the num ingot tons were produced an- gains. ber of trading days, but not for price changes. cloudy- nually, according to William Chrysler was second most-active as it rose as profit-takers skimmed off fat gains from this recently lively one. Douglas Aircraft remained under pressure because of the up-in-the-air Skybolt missile situation. After losing more than 3 point3 last Friday, Douglas fell 2Vn Monday.

Northrop, which makes the guidance system lor the Skybolt, fell 1. Steels Off Steel shares continued to sell off sharply from recent highs. Jones Laughlin, Republic, Youngstown and Armco each lost more than I point. U.S. Steel dropped and Bethlehem J4.

International Business Machines skidded 8Vi points, Xerox 3Ts, Amerada 234, and American Telephone 1. Although Canada South P. Larlin, director of the economics, research and planning department of the Re STEEL OUTPUT SLIPS BY I "The business news from day to day and the leading economic indicators point toward neither recession nor boom," he said. These particular Indica-: tors continue to dance about erratic, contradictory and public Steel Cleve Sales by makers of durable goods were reported to be holding cteady in the current quarter at about $49 billion, their approximate level since last spring. No gain was anticipated through March.

Gains by metal producers and ma land. A housing expert told the conference that since Presi dent Kennedy Issued an executive order barring discri confusing projecting no clear pattern of the econom chinery companies were expected to be balanced by mination in federally assist-! small declines elsewhere. The department said factory inventories were ic roadmap ahead." Contradiction Seen Other industry experts forecast a slight improve EDUCATION The long-forgotten liberal arts grad suddenly finds favor MORE AND MORE businessmen are tending to favor the hiring of liberal-arts college graduates, News Front reports. As Fred G. Huleen, Boeing personnel director, puts it.

there's a need for "a renewed sense of appreciation for English, science, the social studies and math Too many of our specialists have discovered, to their that figuratively they wore blinders during their school days." The magazine, stating that liberal-arts grads are getting ahead faster in most corporations than those recruited from colleges of business administration, says that when the Selective Service College, Qualification test was given to 500,000 male college students, only 38 majoring in business passed. Other passing percentages: education majors, 28; engineering, 68; physical sciences, 66; social sciences, 56 CONSTRUCTION: Babson letter sees outlook for 1963 reasonably good PUTTING TOGETHER projections by the Commerce Department and F. W. Dodge investment advisory service David L. Babson Co.

concludes the outlook for construction in 1963 is reasonably good. The government is predicting a 3.3 over-aH gain to $63.3 billion, including an increase of less than 2 in residential building. Dodge looks for a 5.1 boost even while forecasting a 1.5 drop in residential. Babson notes that since J947, dollar volume of construction has increased three and a half times, compared with a 250 rise in gross national product, because "costs have increased more in this field than in any other major. area.

While the 1947-49 dollar now buys 77 cents' worth of consumer goods and services, it will buy only 51 cents' worth of construction." The culprit: sterdily rising construction labor rates, very nearly ed housing, there was only one way to describe the 1963 construction forecast: "All bets are off." David K. Gillogly, associate economics director for the IN PAST WEEK NEW YORK UV-Steel production slipped slightly last week to 1,858,000 net tons, the American Iron and Steel Institute said Monday. That is a drop of 1 from the previous week, when production was 1,876,000 tons. It marked the second consecutive week-to-week decline and the third decline in the last four weeks. expected to rise by about $400 million in the current ment in automobile sales, in quarter and by $300 million National Association ofiin the first three months of Homebuilders, said the or ern Petroleum was the most active stock on the American Stock Exchange and ahead 316, most securities lost ground in active dealings on this exchange.

Volume increased to 1.43 million shares from 1.16 million on Friday. creased activity in plant and equipment investments, and little change in the steel industry in 1963. The future of the construction industry was viewed as a big question mark. 1963. Such gains would be in line with those of the spring and summer months of 1962, and would give the economy no particular lift.

der "injects an unorcdictable dimension that few economists would want to forecast." I California Promoter Shows Las Vegas How hotel rivals along the Strip pay him the supreme compliment of imitating his an interstate operationand things began to get complicated. (Second of Three Parts) BY HOWARD KENNEDY Las Vegas professional special districts The National Cash something to cheer about. Those who got in on the ground "oor have received back a total of cash and stock equivalent to 49 cents a share." On the basis of a good Nevertheless, plunged into the enormously hotel and casino operators in the mid-1950s smiled when a vertised an 8 dividend return to shareholders in the Fresno Hacienda. Townspeople poured their own dollars into an enterprise which they felt promised to put their city "on the map" as far as the traveling public was concerned. Bayley didn't discourage Register Co.

has been working since last April in an effort to supply thousands of cash registers in Finland with decimals points. A new official mark to be introduced on New Year's Day will be worth 100 of the old bills. "greenhorn" money man hazardous enterprise of starting from scratch and at start at Fresno, Bayley organized a separate corpora named Warren Bayley from California wanted to get into their high-stakes, big-risk business on the Nevada desert city's glittering Strip. tempting to professional Las Vegas hotel men and gambling casino operators at their own game in one of ideas and innovations. Bayley, 62, originally a Wisconsin farm boy who came to California in 1924 to enter the savings and loan field, is chairman and chief executive of Standard Motels, which owns and operates the Hacienda Motel in Fresno.

He's also boss of the corporations which own and operate similar motor hotels in Las Bakersfieid and Indio. They winked knowingly the most fiercely compet and laid 99 to 1 odds that Bayley would go broke in a year. Independent Bankers Elect Robert Yeary ROBERT C. YEARY, president of Hawthorne's Pacific State Bank, has been elected 1963 president of the Independent Bankers Association of Southern California. He is currently vice' president of the group, which is composed of 50 community banks.

Linus E. Southwick, president of the Valley National Bank, Glendale, was -elected vice president of the Robert W. 'McGovney, president of Capital National Bank, Comp- ton, was re-elected secreta-y-treasurer of the bankers. As time has proved, it was The Assembly Interim Financ and Insurance Subcommittee announced at a hearing: httt Monday it would not take up testimony at this time in the Hacienda Motels case because John J. Sobieski, state corporations commissioner, was unavailable, as' a witness.

tion to sell stock in the Bakersfieid Hacienda. Later, he went through the same procedure to promote Indio Hacienda. In both cases, he decided to use Fresno Hacienda funds to get the projects going. Just about this time in the middle 1950s Bayley got bitten by the Las Vegas bug. It was a momentous bite.

Up to this time the Haciendas were strictly a California enterprise, and intrastate operation. This meant that Bayley was not bound Bayley owns 82 interest in another, organization which operates the gaming casino in the Las Vegas Hacienda. He owns 97 interest in Vegas' New Frontier Hotel. itive areas the country, the Vegas Strip. For months Bayley teetered crazily on the edge of failure.

Income Sources He incorporated the Vegas Hacienda to take over and complete (at a cost of $660,000) the original Lady. Luck Hp 1 whose financing had fallen apart, leaving the operation without a master lessee. The deal putting Vegas Hacienda In as tenant was" to run for 15 years, and Bayley undertook to pay a monthly rental of $55,000, plus guaranteeing the payroll for the hired help and paying for the night- Dense Turn to Vg. 13, Col. 3 the idea that the Fresno Hacienda was the wonder of Bayley'3 meteoric rise in a bad bet.

The Las Vegas pros made the mistake of underestimating Bayley's instint for promotion, his uncanny luck and his skill in using other people's to put together a hotel-motel-resort empire potentially worth many millions. Today, Bayley, is an authentic legend in Vegas, where phony legends and legendary phonys are a dime a dozen. Today, Warren Bayley runs his sprawling enterprises from the Nevada gambling 1 i s. His the hotel-motel-resort-gam- blmg game has been consid the motel world. And indeed it was among the industry's innovators, with swimming by rule3 and regulation of the Securities Exchange Commission on the issuance American Cement Promotes 3 Executives JOHN M.

KINARD, 46, president of the Riverside Cement Co. division of American Cement has been named executive vice president of the parent firm. In two other promotions, David C. Honey, 37, formerly executive vice president of Riverside, was elected vice president for operations Of American, and Lawrence J. Ramer, 34, who has served as Riverside's marketing vice president, was named American's corporate vice president for marketing.

Kinard continues to head Riverside. erably aided by the $7 million dollars worth of stock his Hacienda corporations, pools, air conditioning, king- and Bales of stock in the Ha cienda corporations. headed by the "mother hen" btandard Motels, have size and queen-size beds, luxury dining rooms and nightclub entertainment. Fresno Haciend: wa3 pretty successful from the start. Even the investori had vBy expanding across a state line into Nevada, Bay- sold to 18,000 California investors.

ley changed the Hacienda format from an intrastate to To start Bayley ad m. mm. a a a j. a. 1...

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