Evening star. [volume] (Washington, D.C.) 1854-1972, 1917-09-02
FINANCIAL-LOCAL AND OTHERWISE.
BY /, A. FLEMING.

y
BY !. A. FLEMING.
Bankers do not believe that the gov
eminent will force the exchange OF
the first issue, liberty loans. bearing
3h per cent interest, for per cents,
bearing surtax.
The 1000. O00. 900 were issued and ad-
vertised tax free" and this feature
was advanced in arguments to induce
purchases by investors. The manner
in which allotments were made wouio
seem to have made it Impossible Ior
tax dodgers to have acquired any great
quantity via the subscription route.
while the trading in the open Market
has not been such as to suggest CT
forts in this direction.
Nor do bankers generally believe IN
placing a tax on government bonds. as
proposed. unless it shall be deemed ao-
solutely necessary to prevent tax dodg-
ing on the part Of the very wealthy.
who are being called upon to bear
more than a pro rata share OF the eA-
penses of the war.
There is every possibility that the
next bond issue, which, according TO
Secretary McAdoo will have to be mar
keted within the next sixty days. VIII
bear per cent interest. In the pres
ent condition of the money market.
with scores OF great corporations pay
ing to 8 per cent for their accom-
modations and call money at closing
at about 54 per cent. it might be inn
possible to market a 81 per cent issue.
II the next issue carries a tax, when
owned by those with incomes subject
to the surtax-above $4,000 annually-it
would naturally be a great help to the
vestors might prefer the latter to the
former. and when called for transfer
into the As many would not be e4-
changed
they have remained very close to par
a few cents away on a $1,000 bond.
There are very many subscribers to
the first liberty loan who have, per-
payments than they intended to when
they subscribed. and 1t is probable
many bonds will be offered for sale as
soon as they are issued. Bankers are
deluged with requests for the ponos
from people who have paid in full and
are unable to obtain information as to
the time when the bonds will be ready
for distribution.
A Bankers Suggestion.
E X. Boisot. expert bond man. and
head of the First Trust and Savings
Bank of Chicago. expresses regret that
some means was not taken to care Tor
the oversubscription to the issue OF
liberty bonds. and he furthermore be-
Y
per cents should be offered at this time.
He says that the names of the sub
scribers for the extra billion are In the
possession of the bankers and that ne
has in his desk an order for 100000
of the next issue, If placed on the same
terms.
I'VE have educated the people to un-
derstand the 3h per cent. tax-free
bond" said Mr.. Boisot. land to compii-
cate the issue with a sur-tax Will neces-
oil q
take some steam out Of the organiza-
ton already perfected"
Effect on Savings.
lust what effect a per cent bond is
sue would have on savings accounts, is
a matter on which bankers differ.
Many believe that it would materially
reduce savings deposits. while the con-
tention is also advanced that the saw
ines account is started and continued,
as a rule with definite end. and that
the savers who invest in liberty bonds
will do their saving by the fnstallment
route.
New York Market.
Daily Financial America Is in great
earnest in it's plea that the next bond
and says: For the United States to pay
more than 3h per cent for money 1t
horrows would be worse than folly. To
compare the credit of the United States
with that of any other nation Is abb
surd. The per capita debt of the United
States. including liberty bonds. is 3.5
ner cent of the estimated wealth: Ger
many. 81 per cent. and Great Britain.
PAT per cent.
Argue for 8 1-2 Per Cent.
A study of the fluctuations in the New
York stock market, as SHOWN In the Ia
HE nublished on this page, is exceed
inely interesting, perhaps not to hold
era OF investments, but as an fndica-
tion ~ the uneasiness on the street re-
eardinS price fixing and excess pronts
taxation. ..,
one way-in the direction of lower ,
the bears are becoming
SO surfeited with gains that they are
daily growing more AGGRESSIVE
losses have been taken and the pronts
seem so sure that many large snort &C
counts are still open.
Expect Rush Of Business.
Local bankers expect a rush Of bust
ness with Tuesday and Wednesday fol-
lowing Labor day, doubling up ON prac-
tically two days business;
troller Of the currency as an added
burden for the first of the month work.
Bankers Still Fighting.
Investment bankers representatives I
are still busy endeavoring to defeat the |
change in the income tax law |
by which information at the source |
would be substituted for collection at |
the source.
tax law will subject about 100000 Of |
neopIe to the provisions of the law. as |
Compared with under 100000 under the |
existing measure.
with the minimum reduced to $1,000 |
and $4,000, AZ against $500 and 5000.
md ths rata raised to per can't for