Evening star., 1921-11-04
|NvESTDRSBUY|NG
VERY LITERALLY
Orders Overflow From Bond
Section Into Stocks-Spec-
uIative Trading Light.
BY STUART p. WEST.

NEW YORK. November 4.-Every-
thing else that happened in the
financial situation today was COM
plctely overshadowed by the extraor-
dinary strength Of the bond market
On no day since the bonds turned
their corner last June has there been
any such display of excited buying.
The advance became, In fact, fairly
violent. especially in the group Of
foreign government issues, where the
yield. even at last nights prices, was
high by comparison with other class
es Of bonds. The rise of a point and
a half to three points in the French
Belgian. Scandinavian and South
American securities was simply due
to rush of buying by small in
vestors, who had got left on the ad-
vance in other quarters of the list
and were attracted to these foreign
government bonds because they still
promised return of to per cent.
Liberty bonds were likewise bought
very heavily at another sharp jump
in price, establishing another new
record for the year.
In corporate issues the advance eX-
tended from a point to two points.
This remarkable movement on top of
yesterdays s performance was plain
there had been every reason to look
for a reduction in federal discount
rates at this time, the bond marke ct
had not, by any means. prepared it.
self for the news.
The banks, which had been in doubt
yesterday just how to adjust their
rates on mercantile paper to the new
scale OF the federal reserve institu-
tions. put these down today SO that
bills Of ordinary rank were discounted
at 5A per cent. as against the pres
vious figures of 5 q per cent, while on
exceptionally high class paper there
were transactions at 5 per cent
For the most part purely specula-
tive shares were not stimulated any
more than they had been at any time
by the prospect Of permanently lower
money rates.
Investment stocks Strong.
1t was natural that the boiling bond
market should overflow into the in
vestment section of the stock market
Investment stocks have been In de-
mand right along. but it just happen
ed that today this was more notice
able than at any time SO far.
Such a representative investment
issue as American Telephone and Tele-
graph was very active, reaching the
new high record of 100 for the first
time. Although classed as serli-in-
veStment STOCK. American Car anG
Foundry felt the effect of buying by
people who were using cash and TAX
ing the stock out of the market.
Industrial preferred shares are the
most logical beneficaries, so far as
the stock list is concerned. Of the eager
inquiry for investments which will
yield a comparatively high return. The
difficulty here is that the most desir.
able of this class of stocks have al
ready got rather out of rang.
Standard OIL of New Jersey pre-.
ferred. for example. is selling on less
than a 61a per cent basis.
The same is true of Car and Foundry
preferred and Steel preferred, while
Corn Products preferred and American
Locomotive preferred at present prices
yie.d no more than 81: per cent.
Auto Trade Looking Ahead.
The latest reports from the auto.
mobile centerS are that . manufac-
facturers are looking forward to
1929 for return to big profits. A
director in one of the companies
which makes g. popular priced car
declared today on getting back from
Cleveland :hat his company officials
thought that 1922 would show the
largest profit Of any year so far. All
Of the companies making passenger
cars have already begun to give re-
leases to the manufacturers of parts
and accessories. and these are begin
HlaYn &c