The daily morning oasis., 1920-01-10
Saturday Morning, January 10, 1920
BONDS AND INTEREST

Opponents of the proposed bond issue by the City
of Nogales for public improvements make much Gas pos
sbe) of objections to five and onehaf per cent bond
asserting that other bonds issued four and oneha
per cent In that they making mountains out from
molehils
true that there are sold in the market bonds that
bear but four and cneha per cent interest," and there
others that offer high six percent. There is
this difference Bonds bearing the higher rates of inter-
est usually command premium while those offering the
low rates go at par even less than par And where
bonds offered at low rates of interest do reach par they
the bonds of large and wealthy communities, with
millions in taxable property AS an instance there is
noted in the lists of bonds published on certain day in
recent issue Of the DAILY Bond Buyer newspaper de-
voted to the bond business entirely that sinking funds
bonds OF the city OF Boston, offered at four and oneha
per cent, sold at par But does anyone suppose that
Nogales with small population and limited taxable prop
erty sell at par bond bearing interest at four and
one-fourth per cent? Nogales would be more likely to
fall into the like class with Pao Alto California
which sold five per cent bond at 102.03. Perhaps
Nogales would fall into class with Osgood Ohio which
sold six per cent bond at 10083.
study of these lists Of bond sales gives MANY
for rumlnaton, and they very interesting Three
Rivers Michigan sold five per cent bond issue at 10272
That was almost two cents more than Osgood Ohio could
get for six per cent bond. West Unity, Ohio, sold
five per cent bond at par realizing than did Bos
ton from four and one-fourth per cent bond ISSUE
Wichita Kansas, sold four and threefourth cent
improvement bond issue at 5000. Interest onehaf of
cent greater than the Boston bond issues but sold
at nearly per cent ess Stratford Wisconsin, sold
cent water and sewer bond issue at 1OO5 while
only 1888 for five per cent bond ISSUE Why should
there be more than cent difference in the prices
for which the two bond issues sold? Upon the eigh-
teenh of November last Weaver school district in Bun
combe county, North Carolina sold at 0326 bond issue
OF $5OOOO bearing six per cent interest. Four days
later Weavervie school district in the county, sold
Ii six per cent bond issue of $4,000 for 10450. Why
should there have been difference of and twenty
four hunedths per cent between the prices sold
bonds of two school districts within few miles of each
other, maybe adjacent in the same county? And in
fifteenth
the Fowler Union high school district sold $5OO0O five
per cent bonds at 10215ony eleven hundredths of
per cent less than of the Buncombe county school
districts got from six cent bond issue Of onehrd
the amount. Why differences so marked? "The +
Oasis would like to hear from of the fnanciers op
posing the bonds at this time fair for these diff
ferences
Further analysis of the same list would present scores
of differences in prices of bond issues like those cited
which suggest inference that the interest paid seems
to have nothing to do with the prices at which bonds
sod Then it follows that the governing factor or
factors is something beside interest That be-
ing the it plain that Nogeles will not get off
any better with five and one-haf per cent bond or
four and oneha per cent bond than she is entitled to
get off? Nor can Nogales sell year or two hence
four and enehaf per cent bond for the price she
get for five and onehalf per cent bond now Pend
ing reconstruction in all parts of the world will create
great demand for money and bonds galore will be offer
ed for sale. Instead of selling five and onehaf per
cent bonds at premium be done now, Nogales
may be glad couple of years hence to sell such bond
at DISCOUNT pay per cent to get money at par
Better sell the bonds and get the money before peace is
declared and the great work of reconstruction begins
Now then: In the Herald of Wednesday assertion
is made that the bonds that is proposed Nogaes shall
VOTE would sell for only about SO per cent of their face
value. Where they get the foundation for such state
1nent is not apparent Perhaps they read it in the
'Day Bond Buyer quoting the drainage district bonds
noted above There reason for such an assertion
All bond offerings of Nogales and Santa Cruz county
command par or The present proposed issue is
attracting great attention; and City Clerk Cole is receiv
ing many letters of inquiry. The Herald claims
was told by bond buyer that the bonds will be
bought basis of six per cent which would put the