Evening star., 1921-11-27
Highest Rate Paid.


On the 18th of December there will
mature $4O1,557.5oO per cent one
year Treasury certificates, receivable
for income taxes.
II is fact that per cent is the
highest rate every paid by the United
States for money and, this maturing
issue of certificates represents, prob
ably, the final borrowing by the gov
ernment at that rate for many years.
lust a short year ago the American
public was practically competing f1ercely
for the right to subscribe to these per
cent certificates. They marked the
zenith of federal financing, and from the
has steadily yielded by fractions.
The issue referred to also represented
the largest single certificate issue made
Since they were put OUT the govern
ment has issued and sold S1,T4, 14s:50O
of Treasury certificates. all on a declin-
ing scale from 5A to AZ per cent.
It would surprise no one if the federal
financing, December Is, would take the
form Of per cent certificates, while the
great abundance of money and the
lon will wait until later for the Offering
of three-year notes in his refunding Of
Treasury certificates.
Washington has a right to antici-
pate a large part of the December and
January disbursements on account of
dividend and interest payments will
be reinvested on the local market
than at any time for years past.
Safety has been the one idea of in
vestorS in the last twelve months; in
deed, it has dominated to the extent
of keeping much money from other
investments and to aid federal
financing with purchases of public Of
ferings of securities.
This was the net result of the hor-
rible losses sustained in the smash
ing declines in security values in 1920
losses that hurt SO they have not
been forgotten.
Now, however. the business situa-
tion has apparently turned to such
the United States is around the cor
ner'' and the bond market, at least, Is
likely to prove attractive to investors
again; indeed, it has been most active
for some days and one wonders how
long this thing can keep up.
1t is true that business is improv-
ing, but the great business centers
still show decreasing clearings; the
great railroads of the country are
able to show net gains, frequently
from decreased gross. indicating that
maintenance and equipment are suf-
fering.
Bonds have had a big advance.
Money Is not being used as freely in
business. and all things tend to induce
caution in making Investments.
Profits are as desirable as ever and
should not be lost once in sight.
We may not be going back to pre-
war rates for money.
It is interesting to recall that Poto-
mao first 5s sold around no. that
Traction 5s were worth III. Wash
ington Gas 5s, ITO. The only reason
the first-nameG bonds did not go high
- was because Of the retirement
yffvllege at 110. Railway As sold be-
rore the war at san.
Some of the stocks made much
higher price levels pack in 190S-13.
If money is to continue as plentiful
and cheap as at present, local secur-
files must seek higher levels. and be-
ping fractions of the rates of their
desirable loans.
Taking Losses.
This favorite pastime, selling se-
curities and buying them back again
the same day, for the one and only
purpose Of taking losses, to the less-
ening Of your income tax, Is all off,
provision. of the income tax law,
which forbids sale and repurchase of
ALI or any part of the same stock if
the operations are within thirty days
of each other. One may take a loss
and take a chance of waiting month
to buy the shares or bonds back
again.
law. but so long as 1t stands as at
the present time the taking of losses
after the former fashion for income
tax purposes is off.
Expression of opinion by local ex-
perts is that the law will not stand
the test Of the courts.
A stock dividend Is tax tree, but
amenable to income taxes If, after
the distribution the corporation
cancels or redeems at such time and
i'm such a manner as to make 1t
equivalent to a taxable dividend.
In Prosperous Condition.
Trust companies Of the District of
Columbia, reported total resources at
the end of the fiscal year June 80,
1921. Of $72. 2.196,119, as compared with
s51.317,S47 five years ago, according
IL af "a Cd