OCR Text |
Show GIVING OUR WORLD THE Once Over . . . By Dick Morrison Business Trends The Dow-Jcnes industrials hit a low of only a fraction above 600 last Friday, off just about 12, or one-eighth from the all-time high of above 685 set early in January. Jan-uary. This gives rise to such questions ques-tions as, Has the stock market hit bottom yet? Will business volume follow it down?; and is this a good time to make new commitments in business or investments, and if so in what lines? My answers to these questions are strictly my own opinions, based on such understanding of the underlying factors as I am capable of, and offered not as absolutes but only for such interest as they may hold for any reader. My answers are these: The stock market has not hit bottom bot-tom yet, but in fact is quite a way above that point. Business in general is probably due for a further slowing-up, with an increase in unemployment and conditions due to get worse before they get better. One need not be in no hurry to make commitments now. By holding hold-ing off, one will probably see opportunities op-portunities in the next several months to buy whatever it is at prices lower than now. The only logical exception to this is the purchase pur-chase of government bonds which, being near the historic lows set earlier this year are probably pretty close to the bottom, and which can be bought at discounts which assure an overall return, on many issues, of better than 4. 'It is something new for me to be recommending re-commending the purchase of government gov-ernment bonds, because for the past twenty years I have regarded them as among the worst of all possible investments, even worse than the stocks of such slow moving mov-ing outfits as the A. T. & T. Company. Com-pany. Well, even now, this recommendation recommen-dation does not indicate any change in attitude toward these for the long term. It means only that I think that for the next few months, or perhaps for the next couple of years, certain issues of government bonds which can now 'be bought at a substantial discount provide the safest place to put one's money while waiting for the See The Dinah Shore Chevy Show !0W IS A 10-YEAR EDGE IN A COMPACT CAR DESIGN WO YOU DECIDE HOW MUCH MORE CORVAIR GIVES YOU IN COMFORT, CONVENIENCE AND CONTROLLABILITY . . . WITH THESE EXCLUSIVE FEATURES. THEY DON'T COST ONE PENNY EXTRA! REAR ENGINE TRACTION You climb right out of snow, sand and mud where other compact cars bog down. AIR COOLING You never have to buy antifreeze or repair a radiator. And air can't boil over, ever. i A I '- ,) $ - - Drive it it's fun-tastic! See your local authorized Chevrolet dealer for 324 West Main next turn. And by the next turn, I mean sach future moment as stock prices may have come down to more reasonable levels, and the trend in business is again pointing up. And I am not recommending purchase of new issues of U. 8. savings bonds at par. Why buy these, when older issues are available avail-able as low as 83 cents on the dollar dol-lar of par value? The daily papers carry quotations on the latter. Now, one should support such observations as these with at least some sort of sensible analysis of the underlying situation. Otherwise, they appear only as an uninformed guess. The reason I look for a further decline in the stock market averages, aver-ages, a slowing up in business, and deflationary decline in the general price level can be indicated in two words tight money. Quite frequently, these days, the daily papers, in reporting severe declines in stock market averages, I have used words like these: "There was nothing in the news to ac count for the decline". True, there was nothing in the current news to account for it. But the items in the news which were accountable have been appearing throughout the past year or more, and the delayed reaction was inevitable. It was the repeated raises in the rediscount re-discount rate set by the Federal Reserve. The rate now is above 4, as compared with a low of 1 which preceeded by several months the long rise in stock market mar-ket prices which started late in 1957. The sequence of events works like this: (Bear in mind that the stuff we use for money consists of monetized certificates of debt otherwise known as bank credit) When interest rates are low, businessmen, busi-nessmen, farmers and enterprises in general are encouraged to bor row and launch and expand enter prises. The result is almost invari ably an increase in bank-credit outstanding, which means an increase in-crease in money in circulation leading to higher price levels, the bidding up of stock market prices, etc. On the other hand, high interest inter-est rates, together with other anti-inflationary anti-inflationary measures which the Federal Reserve can employ, lead in color Sundays, NBC-TV-The Pat Boone Chevy IUC PRACTICALLY FLAT FLOOR Here's a bonus in extra foot room more than you'll find in many big cars. FOLD-DOWN REAR SEAT-One quick flip and you increase cargo space to 28.9 cubic feet And it's standard equipment! BALANCED BRAKING The quicker the stop, the more equal is the weight distribution on each wheel. Another great advantage of rear-engine design. FOUR-WHEEL INDEPENDENT SUS-PENSION-Each wheel "walks" independently inde-pendently over bumps . . . and how that smooths the ridel corvair Corvair 700 4 Door Sedan PACE MOTOR COMPANY Delta, to an overall reduction In the a-mount a-mount of "money" in circulation, followed inevitable by lower price levels. And right now, interest rates are high and money is "tight." The full impact of this situation has not yet been felt, in my opinion. Rather, it has only started and it will not stop until sometime after a business setback has become more in evidence and the Federal Reserve has taken steps to lower interest rates and check deflation. So, the time to make new commitments commit-ments will be some weeks or months after the basic interest rate has been reduced to, say, some where under 2. There is always a time lag between be-tween the setting of high or low basic interest rates and the effect these rates have on the nation's economy: On stock market prices, and the activity of business in general. gen-eral. Bond prices, however, respond much more quickly, almost automatically, auto-matically, to such changes, for obvious ob-vious reasons. So, if this is a correct cor-rect analysis as to which you must use your own judgment then government gov-ernment bonds, at a discount, should be good buys now. With a substantial lowering of the basic interest rate, these should go up rather quickly; and with slower effects of more new money in cir culation following by some weeks or months, stock market prices should follow, and business in general gen-eral improve after that. But so far, there has been no reduction in the re-discount rate, and therefore this sequence of events is still in the distant future one or two years, that is. To round this thing out with a specific: One day last month I asked a respected broker which issues of government bonds he would buy if he was seeking capital capi-tal gains. He named two, an issue of 2s to mature between March 1965 and 1970; and an issue of 2s maturing between 1967-72,' June, the first of these, selling at $83.60 per $100 of par value, would bring a guaranteed return of 4.54 per annum if held to maturity; the second, selling then at $83.80 per $100, 4.24, as quoted Feb. 5. Apart from this sure return, there is the possibility that with a lowering low-ering of interest rates, these could return to par or close to it much sooner than date of maturity, In which case profits of upward of 15 are possible rather fast. It is also possible they could go lower; but in that case the holder would only need to keep them to maturity maturi-ty to realize a predictable return indicated above. Showroom weekly, ABC-TV. BY CHEVROLET rv 3 1 . .. fast del iivry, favorable deals. Ol Utah My Neighbors HP i "Let's play 'diplomacy. You be the United States and we'll talk you out of every cookie in your kitchen!" Another thing about government bonds, in the strange world of investment, in-vestment, is that one can take as wild a speculative ride on them as on anything else, by buying on margin. Speculators which means vou if you want to engage in it can buy governments on as little as 5 margin. This gives the ordi narily nominal price fluctuations in these bonds a "leverage" of A) toi; meaning that you can by that me thod multiply the profit and loss possibilities of the amount of mo ney you wish to speculate with twenty times over. Thus, a change on one dollar in the price of a government bond could bring you a gain, or loss, of twenty dollars, minus costs of buying and selling, and interest. I might add that, for myself, I have never engaged in such a high leverage speculation, in government govern-ment bonds or anything else, and I'm not about to. Specious Thinking Appropriate for the attention of The Society For The Exposure Of Political Nonsense, in my opinion, is our Senator Wallace Bennett's recent pronouncement concerning the Cuban sugar quota. It represents repre-sents the sort of backward, defeatist defeat-ist thinking for which poor Senator Bennett has been making himself famous since he became Washing-tonized. Washing-tonized. As quoted in the dailies, last week, Senator Bennett took the stand that we should continue to subsidize the outrages of Castro-land Castro-land by buying as much sugar as ever from Cuba, at prices higher than the world market, and almost twice as high as the price Castro is asking of Soviet Russia, because, in the words of Senator Bennett, any reduction in our purchases of Cuban sugar would "give Castro and Guevera and all the rest the opportunity they want to point to such action as an attempt to injure in-jure the Cuban people and their economy". In other words, when Cuba's Russia-loving dictator insults us, and gouges us on price, and acts like a heel toward us in. many ways, we should go ahead and subsidize him in order to keep from giving him a reason for hating hat-ing us! As if he would become more contemptous of us than he is already. That is the sort of inverse reasoning which led Dean Ache-son's Ache-son's State Department to ration munitions to our men during the Korean war, in order to prevent them from "offending the enemy" by winning that war! And that line of reasoning, I say, serves the purposes of international Communism Commu-nism to perfection. One point Bennett and all other appealers might well consider is this: The Beatniks who are running the Cuban Government may not prove much more capable of producing pro-ducing exportable surplusses of sugar than other collectivist governments. gov-ernments. And if so, and if we remain re-main dependent upon Cuban sugar, su-gar, then where do we turn when it develops that they can't supply us? Why not start looking out for the interests of America first, even now, at this late date? Postscript: Backers of Bennett's Colleague, Frank Moss, need take no comfort in my criticism of Bennett. Ben-nett. Fact is, I consider Senator Moss hopelessly naive and ineffectual. ineffect-ual. We had a right to expect some constructive action from the prominent promi-nent businessman and former head of the N. A. M., W-allace Bennett. We haven't been getting enough of it from him. But there is no reason rea-son to even expect anything very constructive from Frank Moss. In that sense, he can't let us down. Chessman Case A lot of Americans were shocked when the U. S. State Department intervened in the case of Caryl Chessman, the many-times sentenced sent-enced kidnapper, etc., etc., who had been sentenced to death in California. In a move which took it completely out of its proper sphere of action, the State Depart KOTICE OF MEETING FOR PURPOSE OF CONSOLIDATION "to C1U LEGAL HQTICE TO WHOM IT MAY CONCERN: Notice is hereby given that on Wednesday the 13th dav of April, 19C0, at 7:30 o'clock P.M., at the American Legion Post Home immediately im-mediately north of Delta, Utah, a meeting of all members of the THEODORE QUE JENSEN POST 117, The American Legion, Department Depart-ment of Utah, and all of the members mem-bers of the ARTHUR L. CAHOON POST 89, The American Legion, Department of Utah, will be held for the purpose of consolidating such two American Legion Posts under a new name to-wit: CA-HOON-JENSEN POST 135, The A-merican A-merican Legion, Department of Utah. Theo. Q. Jensen Post 117 - Eoyd Schena, Cmdr. Arthur L. Cahoon Post 83 Frank Eishop, Crndr. First Publication: March IX 1?53. Final Publication: March 31, 12j3. ment asked the Governor of California Cali-fornia to mitigate the sentence on Chessman, In order to appease cer tain groups in South America who might or might not have demonstrated demon-strated against President Eisen hower if the sentence had remained. re-mained. Completely apart from the merits of the case itself, and the justice or injustice of the death sentence, is the seriousness of any policy of subordinating the administration of justice under American laws and courts to the wishes of unamed foreign agitators, and to the wishes of the State Department, which is not concerned with the administra tion of domestic criminal law. A correspondents of the W'all Street Journal, one Harold L. Levin, Le-vin, of Nutley, N. J., presented a thought-provoking angle on this in a letter published March 3, as fol lows: "Editor, The Wall Street Journal "Your editorial, "Trying to Please', in which you criticize the State De partment for its presumption in suggesting that the Chessman ex ecution be delayed as a device whereoy to still 'clamor' abroad, misses one important point. "Since pressure of this sort is effective ef-fective in preventing an execution, might it be equally effective in causing a person to be executed"? (Signed, Harold L. Levin). Brother does THAT angle give us something to think about! A Contest About Here WHO'S WHO IN THIS AREA This is a family fun contest Nothing to buy us any slip of paper for on entry blank. Not necessary to be present to win; not necessary to bo a subscriber to this paper. Who's Who may be anyone in this area. Clues for his or her identity may bo hidden in any ad in this section; when a black dot appears in an ad in this section, it means there is additional addi-tional advertising for that merchant mer-chant elsewhere in this newspaper. news-paper. Clues may also be placed in that ad. Clues will be scattered. scat-tered. There may be from one to five clues in any ad, or none. This is a contest of skill. We invite in-vite you to try to outwit us. To enter, study the ads, find all the clues you can. Then, write down who you think this week's DEPOSIT THIS WEEK'S ENTRIES WITH THE MERCHANTS WHOSE AD APPEARS IN HEAVY BLACK BORDER SERVICE DRUG CO. KELLY'S GRANT CHURCH preschiption & S0N SINCLAIR DRUGGISTS BUILDERS' SUPPLIES SERVICE "Where Pharmacy Is a . , .r,r.rr, PROFESSION" PAINTS HARDWARE FISHERMAN ' PLUMBING SUPPLIES TOps JN SERVICE Fountain Service, Cosmetics Veterinary Vaccines, Supplies PHONE 5904 AND LUBRICATION. PHONE 4291 MEET ME AT . . . DHS GRADUATE we'll show you why! p STEVENS CO. HATrH,(5 RAMBLER IS LEADING --nlV'-- THE COMPACT CAR FIELDl Hardware CITY CAFE Furniture SPOR BROS. i??3 HOMEMADE PIES MOTDT? r,nTPArTY SELECTED STEAKS 1 iwiu OWi-irruu Large Selection of Furniture FOR THE STOCKMAN DELTA, UTAH Carpenter Tools DOWN TOWN DELTA Hunting, Fishing Supplies D. STEVENS CO. Mercantile Grocery DRY GOODS SHOES NO. 2 SON ARROW ERAND Delta's Dept. Store "YOUR CLOTHES' BEST FRIEND" SERVICE CLEANERS & LAUNDRY LADIES' READY-TO-WEAR PANTING M J SHOES GROCERIES OFFSET LETTEEFF.ES3 J I PHONE 5231 J Millard County Chronicle t . or KENTUCKY BOURBON V ioiu The $5.00 gold pieces illustrated here are from the Waterfill and Frazier collection. They were coined by the United States Government Gov-ernment in 1810, the year that Waterfill and Frazier was first distilled in Kentucky. ATERFILL-FEIAZIER 14 near... oismuo and iottud it wateinu IN THIS AREA Your Neighbors Prizes This! Week, $15.00 are the RULES Read 'em overl Who's Who is. Add the total number of clues you found, but bo sure to put down your name and address, then take your entries en-tries end deposit them in the boxes located at the featured merchants place of business. There will be three featured merchants each week these will be indicated by the heavy border around their ads in this section. Each member of the family may enter once at each of these featured places of business. bus-iness. Thus, you may enter three times and doing so will improve your chances of winning. An entry may be written on any scrap of paper. This contest starts when you receive this issue and closes 2 p.m. the following Monday. At that time a drawing will be QUALITY LGJL Foodliner PBIGIDAIRI ZENITH MAYTAG The DELMART QUALITY MERCHANDISE in GENTS FURNISHINGS DRY GOODS LADIES' READY-TO-WEAR SHOES GROCERIES Thursday, March 10, 1960 i i nrfWr ado fuiih distiuuy company, iaidstowm. urnum held. The first entry drawn that correctly identifies Who's Who will win $7.50. If that entry also al-so has the correct number of clues hidden in all ads of the sponsoring merchants, a bonus of $7.50 will be added. When this bonus is not won, it will be added to next week's bonus and will continue to grow until it is won. Family participation gives you a better chance to win; your wife, husband or some bright-eyed youngster may spot a clue that you miss. Got any Perry Mason in you? Think you can outwit the contest- Remember, you can't win if you don't enter. This contest, its rules and text herein copyright by B. Reint-hard. Reint-hard. Franchised to H. C. Fisch- naller. All rights reserved. MORRIS SUPPLY CO. One of Millard County's Most Complete Stores HOTPOINT PHIL-O & RCA Salesman On Hand Ph. 3305 Hinckley, Utah MILLARD COUNTY CHRONICLE A paper pr.r.ted especially for YOU once each week 52 times a year PRINTING OFFSET LETTEEFP.ES3 |