Business & Finance: Bethlehem Reformation

Last week Bethlehem Steel's Chairman Charles Michael Schwab and President Eugene Gifford Grace wrote a letter to their stockholders which began: "As you know, Bethlehem Steel Corp. is a holding company in that its assets consist chiefly of stocks and obligations of its subsidiary companies and it does not own or operate any physical properties. Its chief income, therefore, has always been in the form of dividends. . . ."

Messrs. Schwab & Grace went on to explain that, thanks to New Deal tax measures, holding companies were now something of a liability. Reasons:...

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