The Caldwell tribune. [volume] (Caldwell, Idaho Territory [Idaho]) 1883-1928, 1916-04-21
New York, April Is, 1916.

NCW IOlh, april 10, lSlO.
The annual test of the American in
vestment situation will come on We'd
nesday of next week, when this years
quota of New York City bonds,
amounting to tifty-hve millions of dol
lars, will be offered for public sub
scription. This annual sale OF city
corporate stock" has in recent years
grown to be matter of national and
international interest, as bids come in,
not only from the principal cities OF
the United States, but from London,
Paris and even the Canadian cities.
Ibis year, on account of the European
war, the bids from foreign sources
will be lacking, but they will be more
than compensated for by the heavy
demands from home sources
Prior to the year 1910, all New York
City bonds were sold as as or less,
and on an income basis to investors Of
from 3H to per cent. In that
year, however, due to the demands Of
investors for higher returns on their
money and the comparative apathy in
the investment markets, New York
was compelled to recognize the new
conditions, and its sale of $50,00O,OOO
bonds that year were marked up to
4A per cent interest, bringing, how
ever, sufficient premium to make the
net cost of the money so borrowed AIS
per cent. In 1913 and again in 1915
the bonds were marked up. still higher
and in 1913 the AZ per cents brought
so little premium that the city had to
meet interest charges of 4.49 per cent
Last year the net basis had fallen to
4.36 per cent.
o.,1 ~, e
country, at least, are quite different
There is supcrabundance of money
seeking investment, both in the hands
of private investors and in the banks
and financial institutions; and, while
this is the case, the law Of supply anc
demand will operate against the high
er income returns Of former years
AS an indication of the market ano
investment rating of the new bonds
we have the fact that on the curl
market last week quite flourishint
business was done in the 4As at 10Y
to 1924, making an investment bash
of about 40 per cent. When it is con
sidered that many prime industrial
and railroad bonds, and even munich
pal and Government issues, bring iron
S to 5A per cent, the premier stand
ing of New York City bond issues i
quite firmly established. The new pol
icies in municipal financing, including
the serial form of maturities, hav
been quite important factors in estab
fishing this high standing, and it is
source of qualification that the olde
city issues have risen in price sine
the announcement of the new issue.
The same is doubtless true of mum
cipal financing in all the more in
portant cities of the United States an
Canada. A new sense OF responsibility
in civic betterment, together with tn
application of scientific principles /
the administration of city finance
have combined to make municipal Sc
curities increasingly safe as "a prin
investment, and consequently the az
mand for this class of securities ha
been greatly enhanced. There is ever
evidence of spirited contest for tn
New York City issues and out-of- tow
subscribers should get their bids
early.
A declining interest in the stoe
market has been the chief feature
recent weeks. Selling pressure h;
developed such strength that publ
trading has all but disappeared, ar
thus the professionals have had thlnt
very much their own way, and tn
the price movements have not bee
truly representative Of actual conc
tons. A great many traders are
constant fear of international comp
cations. with Germanys duplicity
one quarter and Mexicos uncertain
in the other. Washington despatch
indicate the great dissatisfaction wi
which the President and his cabin
receive the official explanations
Germany's submarine policy, and
sooner is one question (unsatlsfactc
ily) settled when another and gre;
er problem is presented for solutle
Under such conditions stock mark
transactions are necessarily restrict'
The British Government, accordi
to local copper producers, has purch;
ed over 400,00O,O00 pounds OF copI
in this market within the last
DAYS. The metal is to be deliver
this year, and in this arrangement
Election is presented Of the enormo
production of American mines and
fineries. At the present time 1t