The Washington herald., 1920-05-03
COMPARISON OR
BOND YIELDS
High Returns Reflect Con-
ditions Existing Shortly
After Civil War.
SHREwD BUYERS ACT
Old Timers Believe Oppor-
tunity Of a Lifetime Now
Confronts Investors.

The appearance Of Z per cent
coupons on the bonds Of our stand.
ard railroad systems leads 10 an IN
lterestins comparison with conditions
foiiowing the civil war. TIE rail-
roads at that time had TO contend
with a period Of reconstruction ana
also with tremendous national de-
velopment. The following 80 . list
Of q few Of the issues which were
offered. together with the prices
which were ruling in 1850 and 1880:
..... Dated Dss 1850 1sss
Central q New Jersey !.
Chicago. Bcfiiafto. q
ouincy Cons. fs......1szs isos is4 III
| Chicago. Milwaukee q
81. Paul Cons. IT,. .1sTx 1865 1l1 IN
Chicago a Northwest
ern Cons. Ts......le1b 1918 fsS 10
Louisville q Eassvins
xssis:s Central i:::isss i i:ss u u II II
New York Central q
HsdsOa River Ist 2. ..is7s Isos Iso Iss
SINKING Fund s.....Is71 1sas Ifs Ils
Morris q Bsse1 1st %. 1884 1914 10 itT
Pennsyiyania n. n.
CPitts- q st. L. lst
7s -.................Ieo 1900 13s IiI
Financial comment during the
summer and fall Of 1856. q year and
a half after the close Of the civil
war. was somewhat similar to pres
ent day articles on financial and
economic conditions. The following
quotation from a letter by Mr.. Nc
Culloch, Secretary Of the Treasury
in 1855. is taken from the CONNER
cianl and Financial Chronicle:
''Since March, 1855. the war has
been brought to a successful con-
lclusion and immense armies have
been disbanded. II no other nation
ever rolled up a debt so rapidly.
none, certainly. ever commenced the
reduction OF the debt so soon after
its creation. II our currency is de-
preciated we have. SO far. excaped
the financial troubles that usually
occur among nations at the close OF
expensive wars. and which, there
was reason to apprehend, would
happen TO us at the termination of
the great war in which we have
been engaged. II our taxes are
heavy. our resources are almost un-
Limited.
Il 90 not disguise the fact that
great financial difficulties are stilI
to be overcome: that our present
prosperity is rather apparent than
real: that we are measuring values
by false standard and that we are.
in fact, exposed to all the dangers
which attend an inflated currency,
stimulate speculation and extrava
gance and lead 70 thriftlessness and
decentralization. Before the country
becomes again really prosperous, the
specie standard must be restored.
prices reduced. industry stimulated.
the products OF the country increased
and the balance Of trade between
the United States and other nations
cease to be against us. That the
country will be again thus really
prosperous is as cei tain as anything
in the future"
Tendencies Of the Past Month.
During the middle OF last month a
reaction set in. Prices became ir-
regular and continued so until the
close. United States government
bonds. which had displayed a strong.
er tendency at the opening Of the
month were liquidated in large
amounts. the selling being attrib-
uted to the necessity of large hold.
ers obtaining funds as a result o.
high money rates. In spite Of mar
ket conditions corporate issues were
offered in substantial amounts, the
tendency turning upward fixed ma
turity obligations rather than pre-
lferred stock issues
The combined average Of forty &C.
tive corporate issues reported by the
Wall Street Journal on April % was
74.os, compared with 77.6S for March
27 and sLII for April %. 1919.
While the closing weeks OF April
have displayed pessimism in fnan-
cial circles. nevertheless conserva-
tive investors are realizing that the
present offers exceptional opportuni-
ties for obtaining high yields on Sc
curities Of our strongest corpora
tions. They also realize that prices
may go lower IL the demand for
capital continues. but the trend Of
bond prices, which has been tending
downward for some time past. must
eventually enter the upward swing.
Investors are beginning to feel that
through the purchase OF per cent
coupons today they will participate
in q repetition of the financial his
fOrv rrhKoA