Upon close inspection and a little research, I'm 99.5% certain that these are the dish cloth and dish towel featured in the 1982 Wish Book. The colors, sizes, positions of the mushrooms, even the arrangement of the green leaves and the dots, all match the description and photo in the catalog.
Measuring 13" x 13", the dish cloth is off-white/cream colored velour. Velour is made by cutting the 100% cotton loops that form on one side during weaving, making a softer but less absorbent material. The edges with rounded corners are hemmed with a surge stitch. The mushroom design, angled in one corner and measuring about 4.75" square at the widest point, has appliqued caps with matching thread and embroidered dots, gills, stems, and greenery. It consists of two mushrooms: one medium dark brown capped with white dots and one small orange capped mushroom.
The dish towel measures 28" long x 16" wide and is the same off-white/cream color as the dish cloth. However, this towel is terrycloth, having uncut loops on both sides. The corners are square, the long edges are selvage, and the short ends are turned up in a 3/8" hem. The mushroom design, centered in the bottom half when folded widthwise and measuring roughly 5" wide and 6.5" tall, has appliqued caps with matching thread and embroidered dots, gills, stems, and greenery. It consists of three mushrooms: one large orange capped with brown dots, one medium dark brown capped with white dots, and one small orange capped mushroom.
A paper hanging tag attached with a plastic fastener proclaims that the embroidery is by "St. Gall." Presumably, this refers to "St. Gallen embroidery," machine embroidery that was developed in the 19th Century in the St. Gallen region of Switzerland, a region known for its embroidery, lace, and other textiles since the 15th Century. By the turn of the 20th Century, machine embroidery had become prized and has remained so to today, especially in haute couture.
In the early 1980s, embroidery and applique fit in perfectly with the emerging country, old-timey style that brings to mind Little House on the Prairie, general stores, wash tubs, and apothecaries. A piece of handiwork that Ma might create while rocking gently next to an oil lamp, a nostalgic and homey scene which in reality is a terrible strain on the eyes.
Stitched on the reverse of both towels is the white tag with dark red-brown print. Familiar to generations of people from 1887 to 1982, the Cannon label was the trademark of the North Carolina company Cannon Mills Corporation, the largest towel manufacturer in the world. Like most corporations, Cannon Mills has a storied and sometimes confusing history of name changes, consolidations, union busting, and ultimately buyouts. In the early 1980s, when Merry Mushrooms products were produced, Cannon Mills experienced a hostile takeover by David Murdock, who bought out shareholders and came to control 98% of the stock in 1982. Murdock later sold Cannon Mills Corporation to rival Fieldcrest. The deal was finalized in 1986.
Interestingly, the tags on the towels read, "Cannon, N.Y. 10020." Why New York when the company was based in North Carolina? Like many big businesses, the selling agency for Cannon Mills was in New York City. But why would the advertising office location be on the tag? This database of corporations lists several companies called Cannon Mills, Inc., one of which was incorporated in New York from 1920-1930 to 1986. This led down a rabbit hole about corporations (or Inc.) and how businesses incorporate but cannot incorporate in more than one state. Never mind. Consider this last answer pending.
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