The Los Angeles Times from Los Angeles, California on September 27, 1968 · 60
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The Los Angeles Times from Los Angeles, California · 60

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Friday, September 27, 1968
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60
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usiness & f inance 16 Part HI FRIDAY, SEPTEMBER 27, 1968 Exchange Trading Zooms 33 in Second Quarter WASHINGTON Registered stock exchanges did 33 more business in the second quarter than the first, with institutional investors setting an even hotter pace, the Securities and Exchange Commission reported Thursday. A rise of 40 from first-quarter levels to a record 7.4 billion in transactions was recorded by four principal types of institutional investors mutual funds, life insurance companies, private pension plans, and property and casualty insurance firms. Transactions by this group were up 50 from the second quarter of 1967, the SEC said. By comparison, transactions on the registered exchanges were 41 above the year-earlier dollar volume. Among the four categories of institutional investors, the SEC said, second-quarter gross purchases totaled $10 billion and sales $7.3 billion both records for net purchases of $2.7 billion. This came close to doubling first -quarter net purchases and brought the total for the first six months of the year to $4.1 billion. Pension funds, with net purchases of $1.3 billion, accounted for almost half of the net acquisitions among the institutional groups covered by the SEC survey. MEN AT THE TOP: Parkinson named new chairman of Anaconda Ci JAY PARKINSON, president of Anaconda Co., New York, will become chairman and chief executive officer on Jan. 1, 1969, Charles Mi Brinckerhoff, current chairman announced Thursday. Brinckerhoff said he intends to retire as chairman at! the end of this year but plans to cohtinue as a director and chairman of the executive committee. CHARLES V.' FENN Thursday was elected president of Carrier Corp., Syracuse, N.Y., succeeding Melvin CJHolm, who has become chairman. THE ECONOMY: Retail store sales lost week rose 8 from year before RETAIL STORE sales last week at ' $6413 billion rose 8 above a year before butlwere almost unchanged from the preceding week, the Commerce Department reported Thursday. Durable goods sales at $2,044 billion were up 5 from a year before and nondurable goods sales at '$4,369 billion increased 9 from a year before. Rail freight traffic last week rose to 15.1 billion ton miles vsi 15 billion in the prior week and 14;3 billion . in the 1967 week. Carl o d i n g s last week . totaled 585,625, up 0.5 from the preceding week and 2.9 above a year before. Intercity truck tonnage last week was up 1.3 from a week before and 6.5 above a year before. BANKING: Borrowings from Federal Reserve System increased this week TljE NEW YORK Federal Reserve Bank Thursday reported member bank borrowings in the statement week ended Wednesday averaged $4to million daily vs. $405 million a wetek ago. Banks , averaged net borrowed reserves of $323 million vs.' a sharply revised minus position of 58 million the preceding week. Bankers said the increase was due to a ftew accounting system and the figire could not be accurately compared with borrowed reserve figures of previous weeks. Commercial and industrial loans at major New York City banks fell $57 million in the statement compared with a drop of $418 million a year ago. HOLDINGS: Ralston moves to end possible conflict of interest RALSTON PURINA Co., St. Louis, Thursday announced its board has acted to resolve what it termed a possible conflict of interest among somje of its directors, officers and employes who purchased stock in a new company. The firm said some members of its company bought aboilt 27,000 shares of the common stock of Minnie Pearl's Chicken Sys-tenilnc. of Nashville, Tenn., on May 1. Also involved were some members of a Ralston subsidiary, Food-maker Inc. Shortly after the purchases Ralston and Minnie Pearl's entered a joint venture and the question of conflict of interest arose. Ralston settled the matter by having the purchasers assign any benefits of the transactions to Ralston. COMPANIES: Zapata, United Fruit may be discussing possible merger FINANCIAL SOURCES Thursday said Zapata Norness Inc. of Houston formerly Zapata Off-Shore Co., is jiolding exploratory talks with United Fruit Co. of Boston on the possibility of merger. The sources . said the companies, which held similar talks more than a year ago, ' resumed discussions following the 2 announcement Wednesday by AMK Corp., New York, that it was the purchaser Tuesday of a $41 million block of United Fruit stock. The purchase represented 733,200 shares or 9.5 of United's outstanding shares. United, commenting on the reports, said several companies have approached it "about making a deal." ACQUISITIONS: Heublein to swap $33 million in stock for wine firm HEUBLEIN INC., Hartford, Conn., will exchange stock valued at more than $33 million for 82 of United Vintners Inc., the production and marketing subsidiary of Allied Grape Growers. San Francisco, a cooperative. United Vintners processes 27 of California's wine grapes. Allied Growers will retain an 18 interest in the unit but will receive 20 of its pretax earnings. MUTUAL FUNDS: Cosh reserves in August rose to 7.1 of assets THE INVESTMENT Co. -Institute '' Thursday reported mutual ., funds . increased their cash reserves to 7.1 of net assets in August from 6.6 in July. The funds entered : September with cash equivalents of $3,458,595,000 vs. $3,112,792,000 a' month before. Net assets rose in August to $48,470,241,000 from $47,-342,478,000 in July. The funds were net sellers in August of about $124 million in portfolio securities. The cash position of the funds increased by about $346 million and the inflow . from the sale of new fund shares was about $222 million. EXECUTIVES: Fickes resigns os chairman of Philco-Ford Corp. ROBERT O. FICKES Thursday announced his resignation as chairman and president of Philco-Ford Corp., Philadelphia, and as a vice president of Ford Motor Co. Philco-Ford is a subsidiary of Ford Motor Co. Fickes said an announcement concerning his future plans will be made later. He had been chief executive of Philco-Ford since 1964. Robert E. Hunter was named to re- . ' place Fickes. MERGERS: Liquidonies offers $143 million deal to UMC Industries UMC INDUSTRIES Inc., St. Louis, Thursday, announced it received a merger proposal from Liquidonies Industries Inc., Westbury, N.Y., that would involve about $148 million in cash, and securities. Liquidonies, which owns about 16 of UMC's outstanding shares, previously announced it would make a tender offer to give it 51 control of UMC. Shortly after, UMC said it was discussing merger with Vare Corp.. and recommended its shareholders decline any tender offer by Liquidonies. The Vare proposal fell through and Liquidonies never made the tender offer. SECURITIES: Amex expected to examine need to add memberships THE AMERICAN Stock Exchange is expected to examine in coming months the need for enlarging its membership from the current 650 seat-holders because of an anticipated rise in trading volume. And it will consider the labor-saving impact of its projected system for automating a sizable part of floor brokers clerical functions. ET CETERA: Trends, forecasts and facts from the business world PROFITS & PROPHETS: Allied Chemical Corp. estimates a $20 million drop in earnings for the third quarter due to heavy start-up expenses in new plants and an over supply of propane and butane. The drop, equal to 71 cents a share, will probably cause a loss in the quarter , . . Union Carbide Corp. expects third quarter net to be about 66 cents a share vs. 61 cents a year ago. IN PASSING: The Bank of France reported a $54.8 million loss in gold and foreign currency last week vs. a $36.6 million outflow in the preceding week . . . Filmways Inc. of Hollywood will acquire Cascade Broadcasting Co. of Yakima, Wash.", for an undisclosed amount of stock . . . U.S. auto makers scheduled 192,654 units for production this week vs. 180,374 last week and 145,147 a year ago . . Airlift International Inc. took delivery of its first Douglas DC8-63F stretched jet . . . Avco has agreed in principle to buy 51 of Rancho Bernardo Inc., a San Diego land development company . . . Shares of First National City Corp., a holding company, formed by First National City Bank, will be listed on the Big Board Nov. 1 , . i The CAB approved an agreement for Eastern Air Lines to lease 10 jets from Morgan Guaranty Trust Co. for $52 million . . . Occidental Petroleum Corp. said it exported its 85th million barrel of crude oil from its Libyan concessions Slocks Skid as Trading Hears All-Time Record BY PHILIP GREER Las Ansclet TimeVWishington Ptst Mws Service NEW YORK The stock market's seven-day winning streak went a-glimmering Thursday as Wall Street racked up the fifth heaviest trading in history. After an upward surge in the first hour, scored on the second heaviest first-hour volume in history, prices began easing and slid lower for the rest of the day. At the final bell, the Dow Jones industrial average was down 5.04 points, its lowest reading of the day, to close at 933.24. Standard and Poor's 500-stock composite gave up 0.23 point to 102.36 and the New York Stock Exchange index lost 0.10 point to 57.44. The day's final volume was 18.95 million shares, the highest since 20.29 million snares changed hands on July 11. First-hour turnover was 6.38 million shares, ranking behind the 6.57 million traded during the same period on July 11. Indicators Contradicted The overall box score contradicted the major indicators. There were 727 winners and 685 losers, compared with 762 up and 590 down on Tuesday. The number of new 196S highs rose to 137 from 125 and there were six new low's, compared with seven in the previous session. ; Analysts pinned the downturn on a combination of fundamental and technical factors. After seven days on -the upside, they noted, the list was overdue for a correction. Now that it seems to have come, chartists will be watching how the Dow behaves when it edges back to the 940 level, the top of the trading range that held the average back for a year. On the news front, word of the U.S. trade surplus in August 88.5 billion dollars was considered disappointing by many observers. Then, too, Allied Chemical announced it will show a loss in the third quarter not unexpected since the company closed several plants recently and said it would have to absorb write-offs but the hard facts helped take some of the edge off the buying. Allied, which was delayed in opening pending the announcement, finally started at 37, down Ilk from Tuesday's close, and finished at 358, down 2Vi points on the day. Auto stocks were all lower after Chrysler succumbed to pressure and rolled back its price increase to move into line with boosts announced by GM and Ford. Chrysler was off ?-a to 6918, Ford gave up ?8 to 55J and American Motors was down 8 to 1298. American Stock Exchange prices edged off in active trading. The Amex average slipped 1 cent to $30.31. Volume came to 8.46 million shares, up from 6.55 million Tuesday. 2 Southland S&Ls Plan Acquisitions Two Los Angeles area savings and loan holding companies Thursday announced proposed S&L acquisitions. Trans-World Financial Co., Beverly Hills, said it has agreed in principle to acquire Presidio Savings & Loan Assn., Santa Barbara for 241,-000 shares of Trans-World common stock with market value in excess of $5.5 million. Presidio has assets of about $36.8 million. United Financial Corp., . Los Angeles, said it has reached agreement for its fifth acquisition so far this year Jefferson Savings & Loan Assn., Van Nuys. Jefferson has assets of $40 million and operates a single office. United would issue 111,000 shares of its common stock with market value of approximately $3.2 million for the association. LABOR UNION, BUSINESS APPOINTEES URGED Professor 'Monopoly' on Economic Unit Hit BY HOBART ROWEN Exclusive to Tht Timts from flit Wuhlmton Pott WASHINGTON A high Commerce Department official charged Thursday that university professors enjoy a "monopoly" on appointments to the Council of Economic Advisers and to its staff. William H. Chartener, assistant secretary for economic affairs, said that economists from business firms and labor unions could well qualify for inclusion on the CEA, and would bring a new and broader dimension to the top government group. Chartener thus brought into the open what has long been a simmering issue in the economics profession. The academic influence has been pervasive, as Chartener observed. Of 23 men who have served on the council since 1946, the only man whose background was not primarily academic waa Leon I 103 102 101 100 99 98 97 96 11941. 3 101 III ll'll HIM I I 1 1 1 1 1 IHI M I 816 823 8'30 9'6 913 920 927 WEEKS ENDING YESTERDAY - NEW YORK Standard & Poor's 500-stock index closed ot 1 02.36, down 0.23 from the 1968 high of 102.59 set Tuesday. High during the day was 103.63; the low, 101.59. The 425 industrials closed ot 111.66, down 0.38; the Rails at 53.03, up 0.92; the utilities ot 66.91, up 0.43. The "500" 1968 low of 87.72 was set March 5. Volume rose to 18,950,000 shares, compared with 15,210,000 on Tuesday. The exchange was closed Wednesday. OVER-THE-COUNTER The National Quotation Bureau index off 35 industrial stocks closed ot 414.64, down 0.37. The 1968 high of 418.13 was set June 10. The 1968 low of 321.51 was set March 6. LONDON The Financial Times index of 30 industrial stocks closed ot 501.6, off 2.1. The 1968 high of 521.9 was set Sept. 19. The 1968 low of 385.0 wos set Jon. 2. Parvin-Dohrmann's Shareholders Vote Vegas Acquisition BY ARELO SEDERBERG Times Staff Writer Shareholders of Parvin-Dohrmann Co. Thursday approved the company's acquisition of Prell Hotel Corp., which owns the Aladdin Hotel and casino in Las Vegas. Parvin-Dohrmann, a Los Angeles hotel-restaurant supply and interior decorating company, also owns the Fremont Hotel, a Las Vegas hotel and gambling casino. It was acquired in July of 1966 for about $10 million. ' For the Aladdin, Parvin will issue 70,125 shares of its common stock, worth about $2.6 million based on the current price of about $38 a share for Parvin stock on the American Exchange. The Aladdin acquisition is expected to be completed immediately. After the meeting, Albert B. Parvin, president and chief executive officer, said it was his personal feeling that Parvin-Dohrmann now has sufficient property in Las Vegas, but added that further decisions were up to directors, some of whom are "extremely bullish on Las Vegas." Denies Riviera Hotel Sought He added that the company is not negotiating for additional Las Vegas properties. Parvin also denied a published report that Parvin-Dohrmann is seeking the Riviera Hotel and casino there. Previously, Parvin-Dohrmann had held at least preliminary discussions with the management of the Riviera, which is owned by a group headed by Harvey Silbert, Parvin-Dohrmann vice president and a director. Silbert is a lawyer who has been instrumental in Parvin-Dohrmann acquisitions in Las Vegas. Parvin told about 20 shareholders meeting at the Beverly Hilton that Parvin-Dohrmann's earnings this year "will be three times that of 1967 and could be even four times as Please Turn to Page 17, Col. 4 Keyserling, whose major experience had been in government. Prior to his commerce appointment early in 1968, Chartener was an economist for Goldman Sachs and Co. of New York, and a vice president of the National Assn. of Business Economists. His remarks were made to an annual convention of the business economists in New York. 'Underestimate Private Potential' Chartener complained that professors have a tendency "to exaggerate the role of government fiscal policy," and that they underestimate the dynamic potential of the private sector. "The result," he continued, "almost inevitably is a recurrent fear that the economy will run out of steam if fiscal policy becomes less expansive." He suggested that introduction of new blood from the business community on the CEA "could correct" Major Western Banks Go to 6i Prime Rate National General AMK Sweeten Bids for Great American BY ROBERT E. WOOD Times Staff Writer , Months-long competition continued Thursday between National General Corp., Los Angeles, and AMK Corp., New York, as the two firms sweetened their rival bids to acquire Great American Holding Corp., New York insurance holding company. National General President Eugene V. Klein announced his firm had increased its offer to Great American shareholders by an additional one-half warrant in exchange for each Great American common share. Each warrant would enable its owner to buy a share of National General common , at $40. National General common stock closed Thursday on the New York Stock Exchange at 49,2. National General's total exchange offer for each Great American common share now totals $50 face value in convertible debentures, plus 10-year warrants to buy lz shares of National General common at $40. The Los Angeles firm's previous offer included the debentures plus 10-year warrants to buy one National General share at $40. Meanwhile, W. E. Newcomb, chairman and president of Great American, disclosed that AMK increased its exchange offer for each Great American share to a $30, 634?o debenture, plus five-eighths share of AMK common and a Avarrant to buy AMK common at $40. AMK's former offer was the debenture plus AMK share and a warrant to buy AMK common at $43.33. AMK common stock closed Thursday at 52. National General already owns about 7 of Great American's outstanding common stock which it acquired in the open market. In June National General moved to acquire as many more shares as possible through a tender offer. It later made a merger bid which Great American executives turned down in favor of e. tender offer made in July by AMK. National General has twice previously increased terms of its exchange offer. Thursday's announcement by AMK was the New York firm's first move to sweeten its original bid. Great American had consolidated earnings of 28 cents a share in the first six months of 1968 vs. $1.33 in 1967's first half. The stock closed Thursday at 77 58. U.S. Exports Soar to High in August but Imports Trim Gain WASHINGTON UP) Merchandise exports by the United States hit a new high in August but the lustre of the achievement was dimmed by a continuing high level of imports, the Commerce Department reported Thursday. The foreign trade surplus for the month was $88.5 million on a seasonally adjusted basis "modest," said Assistant Secretary William H. Chartener, considering it followed a $138.6 million surplus in July. The August figures continued the 1968 pattern of surpluses that were only a fraction of the big ones in 1967. In August 1967, exports exceeded imports by $423.8 million and for the first eight months of last year the surplus totaled $3.1 billion. This year, the eight-month total is $552.1 million. While August exports, a seasonally adjusted $2.9 billion, were the highest ever, they were nearly existing misconceptions about the nature of competition. The freedom of action of the large firm has become increasingly limited, Chartener claimed, but "I don't think this has really gotten across to . the typical academic economists inside or outside government." The Commerce Department official didn't say so, but both major presidential candidates appear to be relying on a mixture of business and academic economic advice during the campaign. Vice President Humphrey's task force coordinator is economist Robert R. Nathan, who has a consulting organization in Washington serving both business and labor. And Richard Nixon includes among his advisers Alan Greenspan, of the Townsend-Greenspan Co., and Pierre A. Rinfret, of the Rinfret-Boston Co.; both New York economic consulting firms for major corporations.' B of A, Security Lead Parade; Dual Level Confirmed BY ERNEST A. SCHONBERGER Times Staff Writer San Francisco -based Bank of America, the world's largest commercial bank, and other major California banks Thursday announced reductions in their prime rates to G'ic,'c joining a nationwide trend. There were some indications current West Coast demand for loans ' is great enough for them to have retained the recent 6V2 rate. But they said a pullback in demand is anticipated and that prevailing money market rates also influenced their decisions. Security - Pacific National Bank, second largest in the state, Wells Fargo and United California Bank joined in the cut to 6!4. Thus they lined up with the vast majority of New York's leading banks which dropped to 6U Wednesday. Moves Emphasize Split The moves emphasize a split in the prime rate among major U.S. banks. Chase Manhattan Bank second largest in New York, the leading money market triggered the flood of cuts by reducing its basic rate to 6 To Tuesday. First Western Bank & Trust Co. of Los Angeles also went to 6 and some . smaller ones followed Chase. Union Bank, Crocker Citizens and Bank of California were among West Coast banks dropping to 6Vi Wednesday. The prime rate is a bank's best rate for its most creditworthy customers. As to the factor of current demand, a spokesman for the Bank of America said it is "seasonally strong and the rate reduction is looking ahead." D. Clair Sutherland, executive vice president of Bank of America and chairman of its finance committee, said: "Loan demand is a little higher than a year ago and a little higher than projected. But it doesn't look ' like it will be a clobbering type of demand." He said he expects demand to level. Reason for Decision Sutherland said the bank decided against the 6 rate "because demand is still good and the cost of money is still high, particularly federal funds at 53A to 6." Another source at the bank said there was "quite a debate and it was close as to whether to go to 6V3 or 6." Please Turn to Page 17, Col. 2 equaled by $2.8 billion in imports, just under the record set in June. Both exports and imports, Chartener said, "were influenced by shipments made in anticipation of a possible strike in East and Gulf Coast ports at the beginning of October, and by a shipment which had been made in July because of the closure of the St. Lawrence Seaway for 20 days beginning the latter part of June. The clock strike threat is likely to affect also the September figures." The August trade surplus "would be in line with a better second half and a possible 1968 trade surplus of about $1 billion," Assistant Commerce Secretary .Lawrence C. Mc-Quade said in a speech in Pittsburgh. This would be far below the $4.1 billion surplus of all 1967. If the United States were to have a trade" deficit for the full year, he said, it would be the first in 75 consecutive years. McQuade told a World Trade meeting that the United States must place more emphasis on increasing efficiency of U.S. industries, must limit domestic growth to a "sensible" pace and maintain liberal trade policies while helping industries that may be badly injured by imports. Magic Chef to Buy Republic Corp. Unit Republic Corp., Beverly Hills, has reached agreement to sell its Gaffers & Sattler appliance division to .Magic Chef Inc. . for about $20 million, Republic announced Thursday. Magic Chef, headquartered in Cleveland, Tenn., would pay cash, short-term notes and common stock for the division. The proposal is subject . to approval by boards of directors of both companies. Gaffers &. Sattler's sales this year are estimated at $34, million. Magic Chef for fiscal 1968 ended June 30 reported sales of $56.5 million. 1 tJK lift grtti jrtT i- gaii A A t

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