The Washington herald., 1910-03-14
Bond Activity and Strength
Weeks Feature.
ISSUES LARGER THIS YEAR
New Offerings During Eleven BUSH
ness Days OF This Month Absorbed
with Unexpected Eagerness, Due
Largely to Healthy Demand from
Investors Here and Abroad.

than stocks were far greater than IN
any previous period. They amounted. IN
deed, for the eleven business days OF this
month 70 about S125.OOO0OO. as compared
with sS2OOO,O00 for the entire month or
March last year.
The new offerings were absorbed with
unexpected rapidly and eagerness, and
at the close OF the week negotiations
were under way for quite as important
and extensive hotauons as were an
nouneed in the week then closed All
these offerings are obviously made or
contemplated In response to healthy de-
mand from investors here and also to an
urgent foreign demand, for II is well
known that much more than the Gus
tomary portion OF recent issues has been
placed abroad and two or three infer
ences from the movement also occur log
ically and obviously. It IS naturally OBJ
vious that the demand for bonds among
investors demonstrates a great growth Of
confidence in the securities OF the big cor
p0ratiOns.
II the objection is made that the sale
of bonds by big banking house or a
banking syndicate means principally a
distribution OF them among other finan-
cial institutions and banking houses here
and abroad it is plain that the pig and
little bankers believe In the securities
they are taking, or else would not load
UP with them,
And II is even more apparent that the
corporations issuing the new securities
the intention Of disbUrsing those funds
for labor and materials in such man.
her as must inevitably conduce to the
general advantage OF business.
Money Demand Increasing.
Idle money is returning to business uses
10 & greater extent than al any previous
time of the year. That such a return Of
funds is conducive 10 new and increased
prosperity is. OF course, another matter
not open to dispute.
The only question that may be raised
is as 10 the continuation Of the demand
for bonds. as 10 the ability OF ali tmpOr-
tant companies TO finance their require
ments. Here is presented the element of
uncertainty as 10 the continuation of the
foreign demand Undoubtedly 10 large
extent that foreign demand is cOndi-
TONED on the controversy over govern
ment finances in Great Britain, for Il Is
from capital. alarmed over radical tend
encies there. that comes much Of the
vast amount of foreign capital recently
invested in American securities. In this
respect the moment is peculiarly oppOr-
tune FOR advantageou sales OF high
class American securities. and the avid
ity with which our bankers and corpora
tons are responding TO the demand in
dieates that they are entirely alive 20
the opportunity.
II Is a demand that may ebb with a
change In the political tide. and II IS
generally advantageous that It has not
been overlooked or neglected. But
whether or not tnducement comes from
political change 70 invest In his home
securities. the attitude of the foreign
investor. by training and inheritance. a
more conservative and scrutinizlng per-
son than the average American inves-
tor. has encouraged the release Of large
amounts OF idle money here into invest
ment in home securities.
PecuIiarities of Bond Offerings.
II has been one Of the peculiarities Of
the present Improvement in the bond
market that the foreign investor came in
first. at a time when American capital
with the experience Of 1907 in mind, was
becoming almost as timld as in the early
part OF that year, and that the idle funds
here only began to come out after the
foreign demand had been in considerable
measure satisfied. Another popularity
OF the recent bond offerings has been
that they have been put out on terms
more advantageous 10 the investor than
at any time since the markets settled
down from the panic disturbances three
years ago. Very likely this circum-
stance is directly related to the high
cost OF living, which impels very many
OF even the most conservative investors
to seek a higher income return than
would have satisfied them as recently as
a year ago
Thus New York City bonds, which are
as abundantly secured as any other mu-
nicipal bonds in the world, are to be Of
fered presently ut an interest yield OF
4I-l per cent. So also the current Of
the investor at a price yielding him at
least 4I-2 per cent The increase in the
cost OF living or the decrease in the value
OF goid-whichever way one may care
TO characterize the principal economic |
development OF recent times-is undoubt- |
eddy the real underlying cause Of this |
Increase in income returns. It is greatly |
to the credit OF bankers and corporation !
managers that they have appreciated the /
new condition and met It IN way that /
has already put more than $4,000 00O OF |
idle money into circulation for buiness
purposes.
1t IS idle to suppose that II the investor
in bonds OF the highest class is impeIJ.d |
or compelled to demand a higher income /
return tho investor in standard stocks /
is not also seeking a better income m
his money. Stocks that attract him must
realize a higher income return than in
several OF the years preceding 1907. The
day OF the 3 or 3 - per cent income re-
turn on stocks is not the present dav.
The stakeholder who has long been ,n-
terested n a particular company needs q
higher return from his capital to quite
as great an extent as does the employe
from his labor.
Largest Morning Circulation.