The Los Angeles Times from Los Angeles, California • 51

U.S. Suffers First Trade Deficit in Over 2 Years 1J mwm finance FRIDAY, MAY 28, 1971 Record Import Level Expected to Trigger Protectionist Move tit SN A A '7r A rr-mrr i i I'm MOSKVITCH KHOROSHO, DA? By Russian standards, the Moskvitch is a very good car, though Playboy Club secretary Barbara Onori has some reservations. The Soviet auto will be among 250 foreign and sports cars shown at Auto Expo, opening today. Times photo by Fitzgerald Whitney Want a VW-Size Car for Price of Olds? You Can't Get It Nyet BY DAN FISHER Wrlltr Fox's Management Claims Victory in Bitter Proxy Fight BY ROBERT E. WOOD Tlmu Staff WrlUr Twentieth Century-Fox Film Corp.

boasted Thursday that an unofficial count of shareholder ballots shows that present officers have won a bitter proxy battle with insurgents seeking to control the company- The leader of the outside group, however, refused to concede defeat. Spokesmen at Fox's New York headquarters said Corporation Trust the New York banking firm selected by agreement of both sides to count the votes, found that management held a lead of more than 1.5 million votes of the 6.4 million shares counted so far. The company noted that counting isn't yet complete, although reportedly fewer than 100,000 remain to be counted. And the insurgents, led by stockbroker Charles M. Lewis and other executives from Wall Street and Sun Chemical have until June 8 to challenge the authenticity of individual proxy ballots.

The votes counted so far represent about 74.8 of the company's 8.56 million outstanding shares, and the announcement of management's 1.5 million lead indicates that the in-Please Turn to Page 15, Col. 3 Class Action Faced by Barr Financial BY ALDELUGACH Stiff Wrtttr Barr Financial Ltd. was named a defendant in a $12.6 million class action damage suit filed Thursday in federal court here on behalf of stockholders. The petition, filed by attorney Melvin Belli, alleges that Barr Financial, along with eight broker dealers and seven individuals named as co-defendants, violated federal securities regulations in connection with sale of Barr Financial's common stock since Jan. 1.

Plaintiffs claimed that they and other stock purchasers lost $6,313,400 in value of the stock because of alleged misrepresentations of the company's financial condition. In addition to the $6,313,400, the suit seeks another identical amount as punitive damages. During the period of the alleged violations from Jan. 1 to May 24, the petition states, Barr Financial stock sold variously at from $5 to $6.37 per share. As of this Wednesday, it adds, the market value of the stock had fallen to $1 per share, and plaintiffs "are informed and believe that said stock will become valueless." Corporate defendants include the following firms which are securities Please Turn to Page 15, Col.

1 Waiting periods for private cars (more than half are in "official" use) in the Soviet Union have been as long as six years and would be longer if the government didn't periodically stop taking orders. The average Russian worker would have to work for nearly four years to earn the cost of a Moskvitch about $5,500. What he would get in return is a four-door, five-passenger sedan with about 80 h.p. and a top speed of 85 m.p.h. If you're really keen on owning one, you can buy a Moskvitch in England (about 100 a year are exported there) and bring it here.

At the most, however, you'll only be able to keep it here a year it doesn't meet U.S. smog or safety standards, and Uncle Sara frowns on that. Despite its light weight (about pounds), the car is sturdy it has to be to cope with Russia's underdeveloped highway system. With repair facilities few and far between, such niceties as built-in towing hooks and an old-style hand crank are standard equipment. Major cities such as Leningrad have fewer gasoline stations than you would find in three or four city blocks here, so the 32-mile-per-gal-lon performance is important.

However, its 10-gallon gasoline tank still limits driving range to about the same a U.S. car buyer gets with his more gluttonous vehicle. The curious can inspect the Soviet auto from now through June 6. Show hours are 3:30 p.m. to 11 p.m.

weekdays; 11 a.m. to 11 p.m. Memorial Day and Saturdays, and 11 a.m. to 7:30 p.m. on Sunday.

Part III 11 for the week ended May 19 averaged $224.9 billion, up from $223.2 billion the previous week. California Recrion called off its deal to sell the Aladdin Hotel in Las Vegas. The casino-owner declared a default and claimed forfeiture of a $250,000 deposit, saying the proposed buyer failed to comply with the purchase agreement. Earlier this month a group of buyers who were unnamed except for Walter Gardner, a Las Vegas businessman, asked for more time to complete the deal. Los Angeles-based Recrion, formerly known as Parvin-Dohr-mann said it agreed to an extension to June 23 if the buyers would deposit $250,000 more of the $12 million price by May 26.

Recrion also said it completed the sale of 6.5 acres opposite its Stardust Hotel for $2 million cash to Herman Kishner of Las Vegas. The court cleared Flying Tiger's purchase of North American Car. A federal court in Illinois dismissed with prejudice a suit brought by dissident shareholders of North American Car Chicago-based railroad car firm, to block its merger with flying Tiger Corp. The Los Angeles-based freight airline said the court action ends the litigation surrounding the merger, which was carried out last Jan. 7, and is part of a settlement proposal between Flying Tiger and the North American Car dissidents.

Under the settlement. North American Car shareholders will join in a proposed 5ft Flying Tiger stock dividend from which they were barred by the original merger agreement. Equity Funding agreed to acquire a New Jersey insurance company. Bankers National Life Insurance Co. of Parsippany, N.J., will be merged into a wholly owned subsidiary of Equity Funding Corp.

of America, the Los Angeles-based financial services company said. The deal, approved by both companies' directors, is subject to stockholders' approval. Equity Funding agreed to issue $36 worth of its common stock for each of the 1.86 million outstanding shares of Bankers National, giving the transaction a value of nearly $67 million. Equity Funding would not, issue more than 1.5 million shares, however, and their value would be based on the average price over a designated 20-day period. Men at the Top Colwell Co.

has elected a new chief executive officer and president. Robert E. Morgan, former senior vice president of the Los Angeles-based mortgage banker, will take over the posts from Bundy Colwell, who will continue as chairman. Colwell asked the board to relieve him of daily responsibilities so that he can concentrate on long-range planning. Another senior vice president, Paul R.

Nordquist was appointed to the new position of executive vice president. Leslie T. Welsh was named president of Studebaker-Worthington Inc. Welsh, senior vice president of the New York-based manufacturer, was elected to succeed Rerald H. Rutten-berg as president, while Ruttenberg was advanced to the chairman's post in place of Randolph H.

Guthrie, who announced his retirement. Ruttenberg continues as chief executive, and Guthrie will remain on the board and become chairman of the executive committee. Studebaker-Worthington produces a wide range of electrical and automotive equipment. Briefly Told Del Monte Corp. told analysts in San Francisco it expects its fourth quarter results to be about the same as last year's 65 cents a share Grow Chemical told newsmen before an analysts' meeting in Los Angeles that it expects earnings of 55 to 60 cents a share for the year ending June 30, vs.

60 cents in fiscal 1970. American National Insurance Co. of Galveston and American General Insurance Co. of Houston said they are studying a possible affiliation Dun Bradstreet and Corinthi. an Broadcasting completed their previously announced merger The New York Times raised advertising rates an average of 13 cents a line as of Aug.

1 The SEC suspended over-the-counter trading in Ladd Mountain Mining of Reno Admiral raised prices on its 1971 color TV sets from 2 to 5V2 Shareholders of Griffin Laboratories approved its merger into Frlgitro-nics Scovill followed other producers in dropping the 1-cent per pound surcharge for copper content in brass mill products The SEC suspended trading in FAS Interna tional for 10 days National Big Board member firms approved a DuPonr, Glore Forgan takeover plan. The New York Stock Exchange membership voted 720 to 98 for a plan protecting the H. Ross Perot group against possible losses in its absorption of DuPont, Glore Forgan Inc. The vote approved constitutional amendments permitting the exchange members to pay the Perot group up to $15 million for losses. The amendments had been approved previously by the exchange's board of governors.

The H. Ross Perot group will recapitalize the firm. The New York Cotton Exchange shut down trading after heavy declines. The exchange suspended trading Thursday morning after heavy action in nearby delivery months pulled the price down as much as $6.35 a bale. The market was reopened for a while but business was so heavy and confused, with some prices falling as much as $9.35 a bale, that exchange officials decided to close for the rest of the day.

Retail sales rose 1 last week and gained 6 over a year earlier. The stores last week totaled $7.47 billion in sales, the Commerce Department said. Durable goods sales, at $2.46 billion, ran 8ft ahead of a year earlier, while nondurables sold $5.01 billion, up 5ft from a year before. The largest year-to-year gains were lift for autos and department stores. The sharpest decline was a 5ft drop in gasoline station sales.

Rail freight traffic, at 13.3 billion ton-miles, fell 11.9ft from the previous week and was 14.7 ft below a year earlier. The Treasury raised $630 million from its Eurodollar borrowings. Reporting on its move to capture U.S. funds held by foreign branches of American banks, the Treasury said it received $630 million in subscriptions for the special securities it offered the overseas branches. The department said it would offer $500 million of the securities, which will pay 6 34ft annual interest at maturity Sept.

1. The Treasury said subscriptions were allotted up to the extent of subscribers' holdings of Export-Import Bank notes maturing June 1. The remainder were subject to a 28.3ft allotment. The commercial banks' borrowed reserves fell in the past week. The New York Federal Reserve Bank estimated the nation's commercial banks averaged net borrowed reserves of $94 million in the week ended Wednesday, compared with a revised borrowed average of $193 million the previous week.

Member bank borrowings from the Federal Reserve System averaged $269 million in the week, down from $308 million. Commercial and industrial loans at major New York City banks fell $207 million, compared with a drop of $28 million the previous week and a drop of $203 million in the 1970 week. The Federal Reserve system reduced its government securities holdings by $177 million. The nation's money supply 60 950 40 30 20 10 53 i 26 MULlON 24 22 20 18 16 14 12 10 8 416 423 430 57 514 521 528 WXS INDINQ YESTERDAY A NEW YORK The Dow Jones 30 industrial stock averag closed at 905.78, down 0.63. Hi(jh during the day was 911.96; the low, 899.94.

The Amex closed off 0.04. LONDON The Financial Times index of 30 Industrial stocks closed at 383.6, down 2.4. Th 1971 high of 398.8 wos set Moy 12. The 1971 low of 305.3 was set March 2. WASHINGTON W) A record flow of imports last month coupled with a slackening of exports gave the United States its first monthly trade deficit in more than two years, the government said Thursday.

The poor April showing is expected to trigger new calls for U.S. trade protectionism as well as damage the nation's ability to bring its big balance of payments deficit into line. The Commerce Department reported April imports at $3,757 billion and exports at $3,543 billion. The trade deficit was $214.7 million, the first red-ink figure since February 1969, when the deficit was $405.8 million. A Commerce analyst said the April deficit likely will touch off a new round of protectionist talk, an approach that has been rejected by the Nixon Administration.

The analyst described the deficit as an aberration, noting that exports fell because the United States had shipped larger than usual amounts of aircraft and agricultural products in March. He said the United States shipped out a large number of 747 jumbo jets in March, but the number slackened in April. Stockpiling Cited At the same time, imports picked up volume, with food products, led by fish, coffee and sugar, and aluminum and steel products leading the way. The increase in metal imports was attributed to more stockpiling by American industries in anticipation of a possible steel strike later this year. The previous record for imports was in January, when they reached $3,686 billion.

Exports were down from March's $3,814 billion. For the first four months of the year, the U.S. trade surplus is only $648 million at a seasonally adjusted annual rate. In 1970, the United States had a trade surplus of $2.7 billion. The Commerce analyst said some decline was expected in the 1971 surplus but he added, "we certainly expected it to be a hell of a lot better than $648 million." Stock Prices Drift in Dull Trading as Dow Index Dips 0.63 NEW YORK Stock market prices drifted aimlessly through the day Thursday as prices dipped fractionally lower in apathetic trading.

The Dow Jones average of 30 industrial stocks lost 0.63 to 905.78. Big Board volume was 12.61 million shares compared with 13.55 million shares Wednesday. Analysts said many investors were reluctant to take investment positions with the three-day weekend coming up. They also said many investors were concerned that further increases in interest rates could restrict the economic recovery. "The institutions are waiting on.

the sidelines building up the courage to act when the current correction phase is over," said David Herdst, of Reynolds Co. He explained that was the reason the market acted indecisively and volume was low. The New York Stock Exchange, index of some 1,300 common stocks-dropped 0.08 to 54.78. There were 716 declines and 570 advances out of 1,658 issues traded on the Big Board. The market had 13 new highs and 67 new lows.

Standard Poor's 500-stock index', dipped 0.19 to 99.40. There were 99 big blocks of 10,000 shares or more traded on the New York Stock Exchange, compared with 90 Wednesday. The biggest was 179,000 shares of Safeway Stores at 35Vi, unchanged. Other big blocks included 158,300 of McGraw-Hill at 22Vi, up 143,800 Peoples Gas at 34V4, off i 114,900 Engelhard Min- Please Turn to Page 13, Col. 1 The company's financial position ha3 improved, according to the president He noted that Broadway-Hale sold an issue of $31 million in new convertible shares during the past year.

Some $35 million in bonds are now being marketed. Proceeds will be added to the company's working capital for expansion purposes, Carter indicated. Expansion projects under way include the Broadway Plaza downtown development in which the company has invested $5 million. It is a joint venture with the Ogden Corp. Groundbreaking ceremonies were held Thursday morning before the annual meeting for the complex, which will include a new flagship store for the Broadway chain, a hotel and an office building.

Please Turn to Page 15, Col. 4 Tlnw Aut What car has the outside dimensions of a Volkswagen, looks like a cross between the Henry and a Toyota, steers like a truck, is about as powerful as a souped up lawn mower, and costs the same as a big Oldsmobile? It's the ''mystery car," the Russian-built Moskvitch, making a rare U.S. appearance at Auto Expo which opens today at the Los Angeles Sports Arena. Among the many exotic sports and foreign cars at the show, the boxy blue Moskvitch looks like a poor relative, but in Russia, where there are fewer cars than in the state cf Connecticut, it's the dream of millions. Occidental Profit Up in 1st Quarter; 70 Figures Revised by Roberta.

Rosenblatt Timtt Slaft Wiittr Occidental Petroleum Corp. re- ported Thursday that it had a net income of $39.3 million or 64 cents a share during the first quarter of 1971. In announcing the results, Occidental revealed a revised profit figure for the first quarter of 1970. The company eliminated $4.2 million in profits challenged by the Securities Exchange Commission. Armand Hammer, Occidental's chairman, said at the time of the SEC complaint in March that his company would not change its financial statements.

The new 1970 first quarter figures are compatible with sets of figures carried in the company's annual report for 1970, issued last week. Complex Accounting The complex reporting of 1970 first quarter net income goes like this: 1 Occidental originally reported net income of $42.4 million for the quarter. 2 In Thursday's announcement, this was revised to $38.2 million. Profits from certain land and oil transactions had been eliminated. The $38.2 million includes income from the sale of leases for the right to mine coal.

3 The Occidental report notes that the SEC says the coal lease income should be excluded from Occidental profits. Occidental says it disagrees, but if this were done, the quarterly net income would drop to $35.6 million. However, Occidental and its outside accounting firm, Arthur Andersen defend the $38.2 million as a legitimate figure "in accordance with generally accepted accounting principles." The company does concede that the change from $42.4 million to $38.2 million partially reflects objections raised in the SEC complaint. The SEC has charged the Los Angeles-based oil, coal and chemical firm with producing "false and misleading" reports for the last three quarters of 1969 and the first two quarters of 1970. According to the SEC, the company improperly included in current income the profits from various deals.

Financing transactions were arranged to look like purchases and profitable resale of land, the SEC said. In another transaction, the Please Turn to Page 15, Col. 6 U.S., German Policy Conflicts Emerge in Talks on Currency MORRIS JR. Wrlttr Hankel appeared to be saying that Bonn should not be held to its pledge to go back to the old parity of 3.66 marks to the dollar. Instead, he urged a combination of measures designed to eliminate the pressures building up in the world currency system because it has not adapted to the changing patterns of world economy and world trade.

Hankel indirectly challenged McCracken by stating that the Western world was no longer on the dollar-gold standard set at Bretton Woods. Please Turn to Page 13, Col. 3 Record Profit Report Cheers Broadway-Hale Shareholders BY JOE ALEX TlfiMl Staff MUNICH The basic conflict between the American and German viewpoints of the world currency crisis came out into the open for the first time Thursday at the international bankers conference here. The American view, put forward at a key session on monetary stabilization by Paul W. McCracken, was to go slow and not jump into new experiments.

The chairman of the Council of Economic Advisers stressed that the international currency system built upon the postwar Bretton Woods Agreement "on the whole has worked well." He pointed out that under it, world trade has expanded at a rate 50 higher than the growth in the gross product. Leading Figures Absent An opposite tack was taken by Prof. Wilhelm Hankel, assistant secretary for monetary and credit policy in the Bonn regime. He was standing in for Detlev Rohwedder, secretary of state in the Economics Ministry and one of several high-ranking German government economics people conspicuous by their absence at this top-level gathering of Free World bankers. Hankel argued that the recent currency crisis which led to the floating of the West German mark should be used to "further develop the international system." Bonn policy was not, he emphasized, based simply on cyclical motivations but was aimed at ending a situation in which national instruments are being used to cope with international problems which extend far beyond any single country's borders.

Broadway-Hale Stores Inc. had record sales and earnings during the first quarter, President Edward W. Carter told stockholders Thursday at the firm's annual meeting. Earnings for the period ended May 1 were $3.6 million or 26 cents a share, compared with $2.8 million or 23 cents a share in the opening quarter last year. Figures were restated to reflect the merger of Broadway-Hale and the Emporium Capwell a division which operates several stores.

Consolidated sales rose to $146.5 million, up from $134.1 million in the first quarter of last year. Business has continued at a brisk pace, Carter told the 60 persons in the firm's 14th floor offices in the United California Bank building. Sales in May are running 10 ahead of last year, Carter said..