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About Medford mail tribune. (Medford, Or.) 1909-1989 | View Entire Issue (Sept. 27, 1963)
MEDKOKD MAIL TRIBUNE. MEDFORD. OREGON FRIDAY, SEPTEMBER 27, 196U Higher Properly Taxes Predicted II Bill Defeated SALEM (UPI) - An "almost certain" increase in property taxes if the tax measure is de feated Oct. 15 was predicted at a Salem meeting Thursday night. Myron Katz, a U.S. Govern ment economist and former in terim committee tax consultant for the Oregon legislature, gave a strong endorsement to a "yes" vote on the tax measure in an address to the Salem Jane Jef ferson Club for Democratic Women. The club voted unanimously to go on record in favor of the tax measure and to urge their counterparts, the Republi can Petticoat Pollies Club, to issue a similar endorsement and join the Democratic Women in soliciting public support for the measure. Oregon has not had a state property tax since 1941, Katz said, and the new measure is designed to help reduce present county property taxes. It can be defended on its merits, he said, because it preserves this state's traditional principal of taxation based on ability to pay together with a more equitable tax rate structure and a broad ened tax base. Passage of the tax measure would be "eloquent testimony that the people of Oregon do not intend to default in their responsibilities as good citizens in a modern world," he said. Defeat of the measure could be "catastrophic" because it would plunge the state into a financial crisis which would dis courage industrial development, seriously impair functioning of government, j e o p a r dize all levels of education, and could result in the first major new taxes in Oregon since 1929, Katz said. Patterson Elected UAL Board Chairman CHICAGO - United Air Lines board of directors have elected W. A. Patterson chairman of the board and chief executive officer. It is the first time the position has existed in United. George E. Keck, former ex ecutive vice president and gen eral manager, was elected pres ident. Patterson, whose airline ca reer began in 1929, has been president of United since 1934 when four predecessor compa Republicans Claim Stockpile Program Report 'Slanted' WASHINGTON (UPI)-A con. troversial report on the nation's multi - billion dollar stockpile program, charging cabinet-level favoritism during the Eisenhow er administration, was branded as "slanted" Tnursaay oy Re publicans. Sen. Stuart Symington CD Mo.) chairman of the special stockpile investigating subcom mittee, made the 100-page docu ment public at a hastily called news conference following a se ries of partisan charges and counter-charges over its con tents. Prominently featured in the report was a critical review of the roles played by former Treasury Secretary George M. Humphrey, ex-Commerce Secre tary Sinclair Weeks, and one time cabinet member Arthur S. Flemming during the time he served as director of the Office of Defense Mobilization. But Humphrey appeared to be the chief target. Political Motivation Claimed Republicans said the report was "politically motivated," and charged it was compiled with the aid of personnel from President Kennedy's office. Symington released the report despite a 3-to-3 voting deadlock in the subcommittee against ap proving it. During a closed ses sion earlier in the day Demo cratica Sen. J. Strom Thur mond of South Carolina lined up with two Republicans, Sens. J. Glenn Beall of Maryland and Clifford P. Case of New Jersey, in opposition. Symington was supported by Democratic Sens. Howard W. Cannon of Nevada and ailing Clair Engle of California, who voted by proxy. Ike Defends Policies Case later issued a letter from Eisenhower defending stockpile policies during his eight years in the White House Portland-Medford Flight Started by WCA SEATTLE (UPI) West Coast Airlines said today it has Coast Airlines said Thursday it has inaugurated a non-stop flight leaving Portland daily at 8:35 a.m. . It said the 70-minute flight was the only direct air connec tion between the two cities. The speedup also will affect flights to Sacramento via Klamath Falls. The flight from Medford to Portland stops at Eugene. It leaves Medford at 3:55 p.m. and arrives at Portland at 5:20 p.m. Timber resources on the pub lie domain of the U.S. have an nies were combined into one estimated current value of more corporate organization. I than $100 million. Your Money's Worth By SYLVIA PORTER Copyright, Halt Syndicate, Inc. as necessary in the national in' terest. Beall charged the report was "slanted in its approach, lack ing in objectivity and unwar ranted in the attacks it makes on former, government offi cials." He said that although the pro gram of stockpiling strategic and critical materials for emer gency purposes began under former President Harry S. Tru man, the report concentrated on the Eisenhower policies of 1954- 1958. "I am shocked the respected officials of the Eisenhower ad ministration are made the ob jects of unjustified charges through the use of distortions, omissions and misinterpreta tions," Beall said. The report said that during the Korean War emergency "some contractors enjoyed excessive and unconscionable profits from their sales of . . . commodities to the government. This was particularly true in nickel." President Kennedy made the same charge in the same terms when he sparked the investiga tion in early 1962. Windfall Profits Charged The report charged that M. A. Hanna Co. mining and smelting enterprises, controlled by the Humphrey family, enjoyed windfall profits of more than $17 million on a government built nickel plant, and also prof ited from premium prices on its sales of nickel to the national stockpile of strategic materials. A multi-millton-dollar Calu met & Hecla Co. copper con tract represented a "clear in stance of special treatment and high-level official interference to the advantage of one contractor and to the substantial disadvant age of the government," the re port said. In 1955, the report said. Hum phrey, Weeks and Flemming, then head of the Defense Mobil ization Office, worked out a deal favorable to Calumet & Hecla. Eventually, Calumet & Hecla gained a $5.5 million windfall through forgiveness of delivery delays and other benefits ap proved by the Eisenhower cab inet members, the report charged. Government nickel contracts with Hanna Mining Co., the Han na Company's subsidiary, as sured the concern of future prof its totaling approximately $86 million, the report said. To Introduce Legislation "Under this arrangement . . . the government exposed itself to the possible loss of upward of $30 million; whereas Hanna did not expose itself to any loss of any kind whatsoever," the report charged, adding that during the time the stockpile contract was in force Hanna Company's prof its were almost five times the mining industry's average. Humphrey clashed repeatedly with Symington during the sub committee's public hearings last year. He charged later that the Democrats were using the in vestigation to get at former president Eisenhower. Svmineton said reform leeisla-1 would be introduced shortly, i Among other things, the report ed speedier disposal methods tion designed to improve the About $4 billion worth in the recommended that the major and use of surplus stockpiled vast $8.9 billion program of stockpile has been stockpiling strategic , materials 1 termed surplus. tentatively stockpiles be consolidated for metals in certain defense con- 1 better management, it aavocat- tracts ana loreign aid projects. NOT IMMEDIATE CURE PORTLAND (UPD-So-called "freezing" of the stomach does not offer an immediate cure for peptic ulcers, a team of Uni versity of Oregon Medical School specialists told the Ore gon Medical Society Wednesday. A 3 SALEM (UPI) Gov. Mark Hatfield and an Oregon Techni cal team met with executives of the Du Pont Company in Wil mington, Del., Thursday to dis cuss opportunities for Du Pont in Oregon, the governor's offica announced. PRICE-EARNINGS RATIOS AND YIELDS Measured by some of Wall Street's most treasured yardsticks stock prices on average again are moving into very high ground For instance, the average price-earnings ratio of the 30 stocks in the Dow Jones industrial average is back above 19-to-one approaching the high ratio reached at the end of 1961 when the market crash began and well above the ratio touched in mid' 1962, when this stock average hit its low. As another illustration, the average yield of the 30 stocks in this popular average is back below 3'i per cent approaching the low yield reached at the 1961 market peak and well below the yield touched at the 1962 market bottom. What is a "price-earnings ratio"? What is a "yield"? How can you compile these figures on stocks you own? If you're typical among America's millions of stockholders, you've read and heard these terms many times but no one has explained them in two-plus-two-equals-four language, nor put them into perspective. Here goes. (1) A price-earnings ratio is the relationship between the price at which a stock is selling and the company's earnings per share. Since a stock reasonably is supposed to sell at a price reflecting to an extent what the company is earning today and i. likely to earn tomorrow, the importance of this ratio is gen erally acknowledged. Say ZYX stock is selling at $100 a share. Say the company's earnings work out to $5 for each share of stock outstanding. You divide the market price of $100 by the $5 earnings per share and you get the price-earnings ratio of 20-to-one. How high is today's average of 19.1 on the Dow Jones 30 in dustrial stocks? Historically, it's high, but that does not mean it's too high and won't go higher. At the end of 1950, when the market's upsurge was in It Infancy, the price-earnings ratio of the Dow Jones aver age was a meager 8.4-to-one. At the peak of the average In late 1961, it was a spectacular 23.4. At the low in mid 1962. It was a more sober 16.5. The key point is that price-earnings ratios vary tremendously from stock to stock. A high ratio may simply reflect Investors' enthusiasm for a stock on the basis of its growth prospects and future earnings. A low ratio may reflect investors' worry about an industry's future. Electronic stocks illustrate the first ratio, tobacco stocks the second. (2) A yield represents what a company is paying in annual cash dividends on its stock as a percentage of the stocks' price. Since the return investors can earn on a stock reasonably influ ences the decision of many to buy it, the importance of yield also is generally acknowledged. Say that ZYX stock, selling at $100 a share, pays $3 a year In dividends. You divide the cash dividend of $3 by the market price of $100 and you get the yield of 3 per cent. How low Is today's average yield of 3.23 per cent on the Dow Jones 30 Industrial stocks? Historically, it's low, but that does not mean It's too low and won't go lower. At the end of 1953, the yield on the Dow Jones average was Sv4 per At lne 1Mt market peak, it was 3 per cent. At the mid-1962 price low, it was 4 per cent. Once more, the key point is that yields vary tremendously from stock to stock. A very low yield simply may reflect the fact that a company is putting most of its earnings into its own future business, and buyers of its stock are betting on that future. A high yield may reflect the fact that while a company continues paying good dividends, investors question its future. Electronic and tobacco stocks again illustrate both extremes. The moral is fundamental. You cannot invest successfully on the basis of yardsticks or averages or cliches. This stock njarket is extraordinarily selective and professional. You must SAVE up to 50 on famous brand PAINT! 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