Yea the windings are really shot. I agree with the above poster. I've done a lot of work on that type of motor it looks exactly like a pre war motor like a type 8 motor from 1930 or 1931. That armature is shifting back and forth. There should be a fiber washer between the phenolic plate and the gear so the armature doesn't move. You should get the armature rewound. Talk to Bob Hannon (he wrote a couple of books on Lionel motors). Nice guy probably will cost about 50 or so plus shipping he does a great job. If you get it done when you install it you have to make sure that it doesn't shift yet is not too tight. One other thing to check is that the holes that the armature ends sit in are not too worn. If you need more help you can contact me. My email is in my profile
Jim
