Great Falls daily tribune., 1920-05-23
TRANSACTIONS ARE SMALLER
IN INVESTMENT LINES
Bv Wells Dickey.

There was little indication in the bond
market during the past week that con,
ditions are reaching a safer level and
that selling will again be on a. sane
basis The whole investment list showed
a decided softening, with volume or
transactions considerably smaller than
in any week previous for several months.
New issues were conspicuous 5y their
absence. and those which were offered
we're largely high-rate railway EQUIP
ments certificates and other securities,
which. from an income standpoint, We're
practically free from competition OF old
seasoned stuff.
The one sensation of the week was the
rand absorption of the S7,5O0OOO l..
& \. Railroad company ten year secured
Z Der cent notes, and the issue OF At
Iantic Coast Line Railroad company ten
year secured per cent gold notes. Both
Of these issues were under-written and
offered by n syndicate headed by j. L.
Morgan & Company, and the notes were
rapidly absorbed through countrywide
campaign. at par and interest. The ac-
tual demand for securities OF this type
seems TO indicate that the market still
has a tremendous buying power and that
the present stagnation is largely the
result of a peculiar human psychology,
pointing to still lower investment prices.
MOVEMENT i1 OoHos.
Other new offerings Of the week in
cj1de S3.OOO,0OO dollars of Northern
Ohio Traction and Light Company six
YER Z per cent gold bonds. which were
marketed by the National City company
the Nbrthern Ohio Traction and Light
compan1 being regarded as one of the
most stable public utilities in the Unit
, ed States. 1t has shown an unusually
satisfactory increase in both gross and
net earnings during the past year. and its
net earnings at present are about three
times total interest charges.
Another issue of consequence was the
S1O.OOO.OO Detroit Edison company q
ner cent first and refunding mortgage
bonds offered by syndicate headed
by the Harris Trust Il Savings bank of
Chicago. The Detroit Edison company
supplies electric light and power to the
CITY of Detroit and an extensive sur
rounding territory. 1t finds large
market for its electrical power among
the various motor car manufacturers in
the Detroit district, and the prosperity
of the company to certain extent is in
tirfasely linked with that of the motor
industry. Net earnings have been un-
usually satisfactory over q period of
wears and at present are more than
twice total interest charges.
There seems TO be no let-up in the
liquidation OF Liberty bonds, and the
market during the past few days has
resulted in a number of new record
low quotations. The unusually stringent
money situation is having it's effect in
bringing large corporate holdings Of Lib
erty bonds back on the market. and
there is every evidence that substan-
tial dumping is now in progress through
ont the entire country. Exactly how
low these bonds will have TO go before
dumping becomes Improbable. is some
what problematical, but it seems certain
that even in the face of present high
prevailing commercial interest rates, it
will soon be unprofitable for corpora
tions to take the substantial losses which
are forced upon them through further
liquidations.
Reaction In Prices.
In the United States today there is
every evidence Of a coming reaction in
many manufacturing and distributing
lines, especially clothing, leather and
shoes. With the general scarcity of
supplies and the consequent sky-rock
eHng Of prices during the past six
months, IL seems that the end has been
seached and that the period of extrav-
agant spending is over Retail estab
(sh4ents the country over report