New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1915-12-06
Baltimore & Ohio'S Bond
Sale Meets Remarkable
Public Response.
SOME SETBACK IN
DEALINGS IN STOCKS
Markets Small Outside Inter-
est Slight-Business Upturn
German Exchange Low.


great ease Of money and the improve
ment Of investment demand, last
weeks immediate oversubscriptiOn by
the public of the S60,O0O,000 of Balti-
more & Ohio per cent bonds was re-
markable. Since the offering Of the
s1OO,OOO,O0O Of New York Central
debenture 6s and the S65,000,000 Of
Pennsylvania Railroad general 4l@s
early in the year, the bond market has
met the great influx OF our obligations
that came from Europe when the Brit
ish Az per cent war loan was put out,
and has made its recovery from that
pressure.
What are to be bond prices and the
return Of money is still matter OF
debate. The enthusiastic purchasing Of
this Junior mortgage per cent bond
at par proves that, for the present at
least, railroads can borrow on long
term obligations at not unreasonable
cost. The Baltimore e. Ohio has, of
course, the benefit Of growing traffic
and better net earnings as improve
ments now completed have told on
operating expense. Not all OF the car
riers are in such good position. but so
fer as possible il may be expected that
those transportation companies that
can will supply their needs through
long term borrowing. h
Temporary financing has over ana
again brought embarrassment to ouf
railroads in time Of stress. The Crea-
amount Of railroad mileage now IN re
ceivership. principally because the
roads could not borrow needed FUNDS,
should be a strong incentive toward
placing the railroads where they VIII
not he subject every year or two 70
the vagaries of the money market, par
ticularly since war means added uncer-
tainty in money rates
Trading in Bonds Quieter.
Dealings in bonds last week were
ouieter, in part, because OF TINS ana
other offerings impending, IN part
through natural reaction from excited
dealings in November. That market,
as now looked back upon, was overen-
thusiastic. 1t began to approach the
speculative spirit shown in stocks, and
dealers came to buy to sell to other
dealers rather than TO place issues per
manently. Prices were carried so high
that some reaction and quieter trad
ing were naturally to be expected.
In November, however, a great many
bonds were taken away from the mar
ket by permanent purchasers. lnstitu-
lions which had been holding back
since summer to see if better bargains
were TO be offered no longer delayed
investment of their accommodating
funds. individuals bought freely, and
some of the profits of war stock spec
ulation found Judgment in bond pur-
chases. Large European offerings were
taken without disturbance.
Bonds of the best grade held fairly
firm last week and were rather scarce,
while junior issues, anticipating the
competition of new financing, were a
little lower. There is still large sup
ply of bonds Of the best grade abroad,
but European selling, particularly that
for London account, was very small.
The proposition that the British gov
eminent take over blocks of American
securities is not yet quite clear. As
generally understood, owners are TO
lend their holdings for use as collateral
in stabiliZing exchange. If so used, our
bonds will be locked up where they
could not be dislodged for while.
Of course, new government issues on
the other side, put out on attractive
terms, may be expected to send back
our securities, but the new French loan
does not seem to have done much IN
this way. Advices during the week in
dicated that the next long term issue
in Great Britain might be put off until
late in the winter, and even when that
comes il is expected that no such wave
of European liquidation will follow as
was seen last summer
Some Reaction in Stocks.
Signs Of better business conditions
come from every side, but in the secur-
tiles market last week uncertainty gave
way to some depression. There had
been no important addition to outside
buying to carry along the upward move
ment Of prices that had anticipate d
our present national prosperity. Let
TO itself he market was inclined TO re-
action, largely from the still top heavy
state Of some of the industrials. Specu
lative purchasers began to get tired Of
waiting for better prices and to close
out their commitments. The profes
sional traders, who must see prices
move if they are to profit, sold short
aggressively, 20 hasten liquidation.
! Previous wide breaks in war stock
were not repeated, When IN the mid
die of the week the turn downward be
came pronounced there was no abrup
drop. and dealings at their creates
we're not on large scale. Before tn
i