New Credit Curbs
Necessary to
Stabilize Prices
WASHINGTON, to—'The Eisen
hower Administration was de
scribed yesterday as embarked on
a concerted policy of restraints on
credit lest prices, fairly stable for
two years, may other wise start
climbing.
“The business boom is getting
pretty exuberant,” said one high
official who asked that he not be
named. “It’s the consensus of the
economic and financial side of the
administration that the govern
ment should exert some effort to
keep it orderly.”
The latest in a series of credit
curbs was announced late Wed
nesday. Effective Thursday, 4 of
the 12 Federal Reserve banks
raised the rate they charge mem
ber banks which borrow from
them.
The Chicago, Boston and Atlan
ta banks raised the charge (called
the discount rate) from 134 to 2%.
Cleveland jumped from 134 to
2 V4%, highest in 21 years. Not
since 1948 had a Federal Reserve
bank increased its discount rate
by half a percentage point in one
step.
Increases by other Reserve
banks are expected to follow soon.
This move, designed as a curb
on inflation, followed closely the
tightening of down payment and
mortgage terms on government
insured housing loans last Satur
day. Also, the Federal Reserve
Board and the comptroller of the
currency have dispatched letters
to banks cautioning against over
liberal terms on auto purchases
and other installment credit.
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PB-14
Airmen Freed From Red China Say
Their Trial as ‘Spies’ Was Phony
MANILA, UP)—Eleven happy XJ.S.
airmen were freed by Red China
Tuesday and sped here by plane
after declaring in Hong Kong
their trial as “spies” was a fraud.
Col. John Knox Arnold Jr., 41,
Silver Spring, Md., told a Hong
Kong news conference that their
B-29 was over North Korea, 35 to
40 miles from Red China’s border,
when it was shot down Jan. 12,
1953, in the Korean War.
As for their release, Arnold told
reporters that “Peiping is not en
titled to a god damn thing.”
In announcing the 11 men were
convicted, Peiping asserted last
November that the plane violated
the air over Manchuria. It was
Arnold’s first chance to answer
the charges and he was emphatic.
“I do not recognize it as a
trial,” Arnold said in reference to
the airmen’s prosecution in Pei
ping.
The happy, grinning airmen
were pronounced in “fairly good
condition” after a medical check
up in Hong Kong.
Maj. William H. Baumer, of
Nude Celebrants Just
Settin’ the Woods on Fire
SANTA BARBARA, Calif., UP*—;
Ethel Wheeler, a U.S. Forest Ser
vice lookout, saw smoke on Santa
Ynez Peak. When she looked once
again, with binoculars, here’s
what she saw:
A man playing a violin and a
woman dancing about a campfire,
executing ballet-like leaps. And
said Miss Wheeler, both were
nude.
She phoned Forest Service Pa
trolman Everett Marshall, who
hiked up the peak a little later
and cited the couple. The charge:
having an open fire in a prohib
ited area.
41 German Coal Miners
Killed in Fire and Blast
GELSENKIRCHEN, Germany,
—Forty-one German coal min
ers were believed dead Thursday
in a fire and explosion which
rocked the Dahlbusch workings in
this Ruhr city.
Another 44 miners were in
jured, some of them seriously.
Fire raging through the mine
halted rescue operations. Mine of
ficials said 25 workers still miss
ing below ground “must be pre
sumed dead.”
The explosion followed a fire
in the mine Wednesday.
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Lewisburg, Pa., was on crutches.
said his left leg was wounded
when the bomber was shot down
and he later suffered frost bite.
They exchanged their drab
Chinese clothes for new U.S. uni
forms and wolfed steaks before
flying here on the first leg of their
long-awaited trip home.
Arnold told the news confer
ence the B-29 was on a routine
leaflet dropping mission over
North Korea when it was attacked
by Mig jet fighters. The bomber
burst into flame and the 11 bailed
out.
Captured by Chinese Commu
nists, they were taken across the
Yalu River border into Manchuria
four or five days later and jailed.
Arnold said that after spending
months in prison he finally was
notified last October that he
would be tried as a “spy.” He
then was confronted with the
charge that his plane came down
in China.
Daniel C. Schmidt, Airman 2nd
class, Coeur D’Alene, Idaho, told
newsmen he was “very happy.”
He was unaware of the domestic
difficulties awaiting him at home,
where his wife married again in
the belief he was dead.
Newsmen in Hong Kong were
warned not to mention this to
Schmidt. It was feared he would
undergo shock, after his long or
deal in Red China’s prisons, if he
was told immediately.
The airmen reported they were
not told why they had been re
leased before their sentences,
which ranged from 4 to 10 years,
had been served. The 11 sai$ they
had been interrogated by Chinese
“for weeks and months on end.”
AEC Says Russia
Is Resuming Tests
Of Nuclear Arms
WASHINGTON, MV-The Atomic
Energy Commission announced
Thursday that the Russians have
resumed testing of “nuclear
weapons.”
The brief announcement said
only this:
“Within the past few days the
Soviets have resumed testing of
nuclear weapons.
“This may mean the begining
of a new test series.”
The most recent previous an
nouncement of Soviet tests was
made Oct. 26, 1954.
Before that, in August 1953, the
AEC confirmed Russian claims to
have conducted a thermonuclear
(H-bomb) experiment. It said both
fission and fusion of atoms—com
monly called “atomic” and “hy
drogen” blasts—were involved.
Two weeks later the AEC said
there had been a fission-type ex
plosion which appeared to be part
of a series. The commission said
at that time it would not make
announcements of each separate
blast of the series.
Today’s announcement did not
specify whether the new explo
Senate Subcommittee
Says Talbott Inquiry
Ended With Resignation
WASHINGTON OR—The Senate
Investigations subcommittee said
Thursday its inquiry into Secret
tary of the Air Force Talbott’s
outside business activities “has
been satisfactorily resolved” with
his resignation.
“Therefore, with the issuance
of this statement, the aforesaid
investigation is concluded,” said
a five paragraph statement wind
ing up the inquiry.
Talbott, denying any wrong
doing, told President Eisenhower
Monday he was resigning. The
President accepted the resigna
tion, and wrote Talbott:
“Your decision was the right
one.”
sion was of the fission type in
volving the splitting of some ma
terial such as uranium-235, or the
fusion type involving the com
bining of extremely light weight
atoms, such as forms of hydrogen.
As late as June 24, the ABC
indicated it had had no evidence
of a major nuclear blast by Rus
sia in almost a year.
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