The Los Angeles Times from Los Angeles, California on October 29, 1968 · 39
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The Los Angeles Times from Los Angeles, California · 39

Los Angeles, California
Issue Date:
Tuesday, October 29, 1968
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11 stth'ns 3 TUESDAY, National News This week's Fannie Moe auction shows mortgage interest rates are rising. Bidding for the Federal National 7, Mortgage Assn.'s 180-day commitments to buy government backed T,home loans with a 6 34 interest ceiling suggested an outlook for net yields averaging 6.73. This was an "increase from the 6.69 indicated last week, the fourth consecutive ' weekly rise. Of The Treasury moved to tighten the tax treatment of some stock elans. ' Targets of the proposed regulation ;are "restricted stock plans" used as compensation for executives. They " are distinct from more widely used r stock option plan3 which wouldn't ; be affected. The basic proposed 'change is that income tax would be ' based on the stock value at the time 'restrictions lapse rather than when it is received. The regulation applies ; to stock transferred after Oct. 26. Orders for machine tools during September hit a five-year low. Orders for metal cutting machines such as lathes dropped in September j to $70,900,000 from $79,800,000 in 'August and $79,800,000 in September, 1967. Gulf & Western puts three men on Brown & Co.'s board of directors. The three new Gulf directors 'bring to six the number of G&W officials on Brown's 12-man board. As previously reported, G&W owns 69 of Brown's common and 40 of its preferred. The G&W officials joining the board are Roy T. Abbott, Charles G. Bluhdorn and Harry E. Gould. Daniel A. Porco, Brown chairman, did not seek re-election. He said this was "my choice." He remains a $50,000 a year consultant rto the paper manufacturing company. The election took place at a special shareholders meeting in New York in lieu of the annual meeting. Martin Marietta Corp. plans to sell part of its Bunker-Ramo stock. Martin Marietta said it is arranging for registration with the Securities & Exchange Commission for eventual sale to the public of 2 million shares of its holdings in Bunker-Ramo common stock. Martin Mari etta said it is anticipated the offering will be made within 60 to 90 days. After the sale of these shares, Martin Marietta will retain in excess of 3,800,000 shares - remaining the largest single holder of Bunker-Ramo stock. Two officers of Pickard & Co. were barred from practice as advisers. The Securities & Exchange Com-. mission also barred John Sackville-iPickard, president, and Peter Sack-Mlle-Pickard, vice president, from (further association with any broker-Jdealer. The two officers of the now-fdefunct New York brokerage firm jihad been charged with making false 'and misleading statements to custo-;mers in violation of federal securi-ties laws. The SEC noted that the 'two men waived a hearing and j consented to the order in order to j settle proceedings against them. I Luckies and Camels will cost more, and all cigarets may follow suit. I American Tobacco Co. raised the price of Lucky Strike cigarets to $9.45 from $9.25 per thousand, and R. J. Reynolds Tobacco Co. announced a similar increase for ' Camels. American's price boost was ! communicated to its customers Oct. ; 25 but no public announcement was ' made, the company said. Tobacco industry sources said they believed the increase in Luckies, American's (only regular-length brand, might signal an industrywide price hike. Then came news of the same I Increase for Camels. The last general increase occurred June 1, 1967. I Three other big cigaret manufac- turers Lorillard Corp., Philip Mor-: ris and Liggett & Myers said they 1 haven't taken any action on prices ? yet. f Atlantic Richfield plans a new $100 million refinery in Washington. ? The new plant will be located near Bellingham in the northwest part of the state. The operation, which is scheduled to go into production in 1971, represents a 26 increase in the company's refining capacity. .' Thornton F. Bradshaw, president, said the 100,000-barrel-per-day refinery will cater to the rapidly ' expanding Pacific Northwest market and will serve as a conversion ; point for Atlantic Richfield's North Slope Alaskan crude oil. ' Armeo Steel's hike in pipe prices r is under study by other companies. The company said it will raise prices effective Nov. 1 for standard wall line pipe from 1 V inches to 14 inches diameter by $10 a ton. Armco also said it has raised its charges on three grades of high-strength line & finance OCTOBER 29, 1963 Part III 9 pipe, following similar action earlier by U.S. Steel Corp. Republic Steel Corp. said it is studying the Armco increase, and Kaiser Steel said it is surveying the price situation on tubular products. Bethlehem Steel Corp. said it has raised prices on electric fusion weld and certain electric resistance weld line pipe effective with shipments on Nov. 1. Yields on Treasury bills rose for the fifth straight week at auction. On $1.6 billion of 91-day bills the average yield rose to 5.471 from 5.396 last week. It was the highest yield since the 5.578 on June 17. The rate on $1.1 billion of 182-day bills climbed to 5.473 from 5.457 last week, highest since 5.554 on July 15. The World Treasury will slash French import duties now that subsidies are cut. The countervailing duties placed on imports from France last month will be cut by 50, a spokesman said, because the French are making a corresponding cut in their subsidies to manufacturers. The Treasury Department must impose a special tax on imports from countries that subsidize their manufacturers to artificially lower prices to U.S. purchasers. But when the subsidy is cut, the duty must be reduced similarly. On Nov. 1 the subsidy the French government granted to manufacturers rocked by upheavals this spring is to be cut in half. California Allegheny Beverage loses bid to get Arrowhead & Puritas shareholder iist. A federal judge in Los Angeles also refused to issue a restraining order to halt the proposed merger between Arrowhead of Los Angeles and Coca-Cola Bottling Co. of Los Angeles. Directors of Arrowhead and L.A. Coke have reached an agreement to merge through an exchange of more than $36.9 million of stock. Allegheny of Baltimore has made a $15.75 cash tender offer for 47 of Arrowhead's stock. Men at the Top A restructuring of The Times top management staff was announced. Publisher Otis Chandler said the restructuring included the appointment of two executive vice presidents and three vice presidents. Robert D. Nelson was named executive vice president and general manager and Nick B. Williams was named executive vice president and editor of The Times. Nelson also is corporate vice president, newspapers, and a member of the management of Times Mirror, parent company of The Times. Other appointments include the naming of Richard S. Robinson as vice president, administration; Vance L. Stickell, vice president, sales and Charles C. Chase, vice president, production. Robert C. Lobdell, assistant secretary and assistant general counsel of Times Mirror, was named secretary and general counsel of The Times and James N. Isaacs, controller. American Express Co. has elected Howard L Clark as its new chairman. He will continue as chief executive officer. William H. Morton was elected president, succeeding Clark. The changes are effective Nov. 1, following the formal closing in San Francisco of the acquisition of Fund American Cos. Fred H. Merrill, chairman and president of Fund American, will be elected a director and chairman of the executive committee of American Express. Ralph Owen, who had been chairman of American Express since 1960, will continue as a director. Briefly Told Profits & Prophets: H. H. Robertson Co. President Douglas A. Jones told the Los Angeles Society of Financial Analysts he expects Robertson fourth quarter sales to exceed the $44.2 million sales of fourth quarter 1967. In Passing: AMK Corp. directors adjourned a special stockholders meeting, having apparently given up their attempt to acquire Great American Holding Corp., for which National General Corp. recently won a proxy fight . . . Perm Central Co. bought 130 high-speed diesel freight locomotives for more than $31 million ... The Fed denied Charter New York Corp.'s application to acquire Central Trust Co., Rochestei . . . Parvin-Dohrmann Co.'s two top officers completed sale of 300,000 of their shares to Delbert W. Coleman . . . Two Big Board seats brought $490,000 each, up to $20,000 from the previous sale . . . The Santa Fe Railway ordered a $750,000 locomotive simulator to train enginemen. ii liiilSillililliilii 8?" - .V- v iTST"! "s!;--AWWIsJ CLASSY CHASSISRalph L Crutchfield tries his hand at a $5,000 pool table manufactured by Tiffany Tables Ltd. of Sherman Oaks. The 21st Annual Western Market of the National Sporting Goods Assn. at the Anaheim Convention Center drew 398 exhibitors and 5,200 buyers. Times photo by Jack Carrick Competition Grows for Sporting Goods Dealer but So Does Profit BY MARTIN KOSSMAN Times Staff Writer The independent sporting goods dealer faces encroaching competition at every turn and still he prospers, its chief spokesman says.- Ralph Crutchfield heads his own sporting goods concern in Spartanburg, S.C., and is president of the National Sporting Goods Assn. which Monday wound up its 21st Annual Western Market at the Anaheim Convention Center. Crutchfield says competition is springing up on all sides. "The automotive stores now have promotions on golf balls, and you'll see sports equipment at all mass merchandisers, most drug stores and variety stores and even at service stations," he said in an interview Monday. The only solution for the indepen-d e n t sporting goods dealer, in Crutchfield's opinion: "We must create an image of ourselves as specialists. We have to convince Union Oil Reports Record Profits for Quarter, 9 Months BY MICHAEL C. CHAPLIN Timet Staff Writer Union Oil Company of California, Los Angeles, reported record revenues and earnings Monday for both the third quarter and the first nine months. Oil and gas production and sales also reached new highs. President Fred L. Hartley said net earnings for the third quarter ended Sept. 30, reached a record $38.5 million or $1.16 per common share based on 27,544,896 shares outstanding. This compares with earnings of $37.1 million or $1.11 based on 27,657,931 shares in 1967. Assuming conversion of outstanding preferred shares and convertible debentures into common shares-and exercise of outstanding stock options, the 1968 per share figure would be 94 cents a share net vs. 91 cents a share in 1967. . Revenues for the three months reached a new high of $473.4 million compared with $432 million in 1967. Please Turn to Page 11, Col. 1 MAY CHANGE EVERY Flexible Discount Rate Seen BY HOBART ROWEN Exclusive t Tht Times from flit Washington Post WASHINGTON Changes in the Federal Reserve System's discount rate "might be necessary as often as every several weeks," beginning early in 1969, Federal Reserve Board governor Andrew F. Brimmer said Monday. Since a shift in the discount rate has taken place only 28 times in the last 14 years, Brimmer noted, the increased frequency will be a challenge to the financial community and the financial press in interpreting what the changes mean. Heretofore, the relatively few increases or reductions in the discount rate have been major financial events with wide market implications. But the more frequent changes, Brimmer suggested, would be f SC&T'? - ft iiV fiw"1 "mi. customers that we are the people who know. "We've got no other excuse for existence. If we don't create that image, all these other guys are going to beat our brains out." But Crutchfield is quick to point out that there isn't much concern yet in the sporting goods field because business is booming. U.S. consumer purchases last year, he said, were $3.3 billion, a 7.9 gain over 1966 and the industry's best year. And sales for the first eight months of 1968 are up 10 from the comparable period last year. Sales are expected to top $4 billion by 1970. Crutchfield said California led the nation last year with purchases of S3SS.1 million, nearly 12 of the total market, and a 9.5 increase is forecast for this year. Sales in the sporting good3 field are increasing at a rate 50 greater than any other retailing market, Crutchfield maintained. The just-concluded Olympics can't help but stimulate further interest, he predicted. Crutchfield said the picture of rebellious youth more interested in political protest than football games doesn't bear up. "Youth is not turning away from sports," he said, "it's just that one., segment of youth is publicized more than another." Youth participation sports, such as Little League baseball, have burgeoned in recent years to the point where you find them even in the smallest towns, he said. "And youth increasingly is getting into the family act. Where it used to be that just Dad went fishing, now mother and the children are going along. And the same is true of winter sports." Sporting goods dealers are cashing in on this, he said, and government programs, especially in the ghetto areas, are also stimulating sales. Formation of teams, from Little League through college, are also proving a boon to sporting goods dealers, he said. "The high schools are now spending as much on equipment as the colleges, and there are 25 high schools for every college." Crutchfield said he regrets reading reports of equipment makers pressing money on Olympic athletes to Please Turn to Page 11, Col. 4 FEW WEEKS smaller, and presumably less earth-shaking. The discount rate is the interest rate charged by Federal Reserve banks on their loans to member banks. The current rate is 5 14, established in mid-August. Normally, once the Fed in Washington approves a change in the rate for one or several of the district reserve banks, the others follow suit in a few days. But Brimmer dug into history to show that the several reserve district banks have not always adjusted their rates in a "timely manner." Given the prospect that discount rates in the future will be much more frequent, he suggested that steps should be taken to assure a "consistent monetary policy" throughout the country. He also chided the board for an U.S. September Trade Surplus Best in Year Boeing 3rd Quarter Earnings Rise but Slowdown Indicated BY ARELO SEDERBERG Time Staff Writer Boeing Co. reported a slight gain in third quarter profits Monday, but several related developments indicated bleaker times upcoming, at least temporarily, for the Seattle producer of commercial jetliners and space systems. Third quarter profits amounted to $25.3 million, equal to $1.17 a share, vs. $22.3 million, or $1.11. Sales were $795.2 million vs. $713.9 million. It brought profits for the nine-month period ended Sept. 30 to $71.2 million, or $3.29 a share, vs. $60.6 million, or $3.02. Nine month sales were $2.43 billion vs. $2.09 billion. Other developments: Boeing said its 1969 profits "will be less" than 1968. No estimate was given for 1968, but Wall Street sources expect a good increase from the $4.10 a share reported in 1967 on sales of over $3 billion, vs. $2.8 billion in 1967. Airlines said they have switched 10 of the 11 orders for airfreight models of the 747 jumbo jetliner to passenger -carrying models. The lines said they were disappointed by the payload and range capabilities of the 747's freighter version. Boeing confirmed a rumor that it has decided not to bid on the FX, the Air Force's proposed advanced tactical fighter. The company said 1969 earnings will be adversely affected by "approximately 100" fewer deliveries of its 707 and 727 jetliners next year. Aggregate charge-offs in 1969 from new commercial jet transport programs, Boeing said, will be substantially below this year's total. The company added that the expected slide in profits "should be temporary." Boeing's total delivery of all types of commercial jetliners in the year through Oct. 17 amounted to about 289, a spokesman said. The company's backlog of unfilled orders on Sept. 30 amounted to $5.46 billion vs. $5.89 billion at the end of 1967. In the third quarter, deliveries of Please Turn to Page 11, Col. 5 Disappointment on Peace Talks, Pre-Election Jitters Hit Market NEW YORK U) Wall Street showed disappointment Monday over the lack of any progress towards peace in Vietnam, and it also displayed some pre-election jitters. The result was a moderate decline. The street was cautious rather than fearful, as reflected by the drop in volume to 11.74 million shares from 14.15 million Friday. On Friday the market rose in advance of the weekend when, it was felt, there was at least an even chance of some vastly encouraging news regarding steps towards Vietnam peace. Much of that buying was precautionary. Dow Falls 3.55 Monday's performance was the opposite side of the coin. Nothing positive developed and, in fact, there were some very negative reports, so the desire to buy wilted, and sellers were dominant. The Dow Jones industrial average declined 3.55 to 957.73. Another source of uncertainty was published comment about political polls, which seemed to cast a cloud over what Wall Street had been regarding as the certain election of Richard M. Nixon Nov. 5. There was quite a "Nixon market" in September because of tha apparent certainty of his success. As an element of to Cut Reaction inadequate policy of communicating to the public the reasons for changes in monetary policy, and said it will have to do a better job in the light of more frequent discount rate changes. Brimmer also said that communication within the various parts of the Federal Reserve System itself left a great deal to be desired. The possibiUty of frequent changes of the discount rate stems from a proposed revamping of the discount arrangement to make it a more flexible mechanism, and to rely more fully on it to provide credit extension to member banks. The discount "window" would be relied on to provide more of the banks' day-to4ay needs while the use of open market operations (buying and selling of securities) to affect reserve levels would relate Please Tarn to Page IS, Col. 7 $282 Million Gain Still Falls Short of Original Goal WASHINGTON W The foreign trade surplus soared to $282.2 million in September, the best showing since November, 1967, the Commerce Department reported Monday. The September surplus of exports over imports brought the cumulative surplus for the first nine months of 1968 to $834.3 million. In the same three quarters of 1967 exports were outrunning imports by $3.5 billionmore than four times as much. $1.5 Billion for Year "If we continue at the September level of performance through the fourth quarter," said William H. Chartener, assistant secretary for economic affairs, "we ought to end up with a surplus on the order of a billion and a half dollars, which is somewhat more optimistic than tha figures we've been using the last few months." September imports totaled $2.96 billion on a seasonally adjusted basis and exports $3.25 billion, both records. It was the first time that exports have topped $3 billion. Chartener said hedge buying in anticipation of a strike in East and Gulf Coast ports undoubtedly contributed to the high level of both imports and exports. Asked if these special circumstances meant that the increases were artificial, Chartener said that the strike threat effects should not be minimized but that "indications are that something more fundamental is going on here." Even if the $1.5 billion figure is realized, the year's showing still would fall far short of the original goal. The comparable figure for 1967 was $4.1 billion, and President Johnson had set a goal of exceeding that figure by $500 million this year as part of his effort to reduce the balance of payments deficit. The $282.2 million surplus was the second in 1968 to exceed $200 million. A $248 million surplus was posted in April but there have been three months this year in which exports fell below imports. doubt was injected, prices softened. Of 1,571 issues traded, 832 declined and 522 advanced. New highs for the year totaled 93 and new lows 11. The New York Stock Exchange index fell 19 cents to $58.43. Stand-Please Turn to Page 13, Col. 7 106 105 104 103 102 101 100 99 jl S5H . )94.4j Ml 22 20 18 16 14 12 10 920 927104 1011101810?5 111 NEW YORK-Stondard & Poor's 500-stock index closed at 103.90, down 0.30. High during the day was 104.89; the low, 103.16. The industrials closed at 113.49, down 0.37; the rails at 53.88, down 0.10; the utilities ot 66.81, up 0.10. The "500" 1968 high of 104.99 wos set Oct. 21. The 1968 low of 87.72 was set March 5. Volume-declined to 11,740,000 shares, compared to 14,150,000 on Friday. OVER-THE-COUNTER The National Quotation Bureau index of 35 industrial stocks closed at 412.35, down 1.35. The 1968 high of 422.25 was set Oct. 21. The 1968 low of 321.51 was set March 6. LONDON The Financial Times index cf 30 industrial stocks closed ot 477.7, up 1 .4. The 1968 high of 521.9 was set Sept. 19. The 1968 low of 335.0 was set Jan. 2. ------ iriti-i-ir

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