The Washington times., 1913-09-18
SMALLER BONDS ARE
IN GREATER DEMAND
Washington Railway Securities
of $500 Worth More Pro-
portionateIy Than ST, 900.

An investor could have sold one
$1,000 bond of the Washington Railway
Is on the local stock exchange this af-
ternoon for S2250 less than he could
have sold two $500 bonds of the same
issue One broker was bidding S3is
for two $500 bonds, but his best bid
for the same issue in $1,000 denomina-
lions was 92A.
That there should be such a dis
crepancy between the prices for the
same bonds in different denominations
illustrates effectively how large part
temporary demands play in the price
even of investment securities, as against
the real intrinsic worth of the securi-
ties. Intrinsically, of course, the Two
bonds are worth precisely the same,
Fifteen shares of Citizens Savings
secured by the same mortgage.
Fifteen shares of Citizens Savings
Bank were sold at %, in two lots, one
of ten shares and the other of five, af-
ter which ten more shares were offered
at 21Ls, and taken.
Federal National Bank figured in the
dealings, four shares being sold at 135.
Metropolitan SIS sold at 1057s, and SIX
shares of Washington Railway and
Electric common sold at S9ia After the
regular call, three shares of Mersen-
thaler Linotype sold at 215l.. and one
more at 215 fiat.
The plan of John H. Dospassos, of
New York, to divorce stock exchange
transactions from the banks, as advo-
Gated yesterday before the Senate Bank
ing Committee, aroused considerable un-
favorable comment among local brokers
today,
They admit the overcertifcation of
checks In the course of the transac-
tions. but claim that this merely means
that the bank overcertifying check is
loaning the broker that amount of
money knowing that he will use that
check for the consummation Of pur-
chase of stock or bonds, which will be
deposited with the bank at once as
security for the loan.
For instance" said one broker this
afternoon, "a big operator in New York
buys 100000 worth of railroad stocks
in the course of the days trading. He
wants to get possession of the actual
shares, so that he can deposit them in
his bank. and borrow money on them.
But he cannot place the certificates in
bank until he has paid for them. So
purchase. has this certified by the bank,
gets the stock, and places il in the
bank Then of course he owes the bank
the difference between his original bal
Ance, and the amount of the check For
q few minutes, between the overcert-
the stock with the bank, it is illegal,
but the amount of convenience is enor
NOUS. and the whole custom is merely
one of trust between the banks and. the
brokers' And the brokers' business,
seat on the exchange, and everything
he owns is behind that trust
The large number of young Washing
ton bankers who have been attending
the annual convention of the American
Institute of Banking at Richmond, are
expected home tonight, and will be
back in their cages bright and early
tomorrow morning, to begin an on
slaught upon the work which has piled
mp in their absence. Secretary of State
Bryan. who talked to the young finan-
ciers today, is also expected to return
tonight, or tomorrow morning.
The Washington delegation has been
one of the most prominent at the con-
vention, not because of its numbers,
but because all of the Eastern and
Northeastern delegates who accepted
the hospitality of the Capital City chap
ter on their way to Richmond, have
been talking about their reception and
entertainment ever since, piling up
credit for this city.