The New York herald., 1921-08-01
Average Bond Prices
July 30, 1871.


The reinvestment demand. long an
ticipated by security dealers when
money rates really showed signs Of cas-
ing. was in full swing last week. In
vestors competed with each other in the
purchase Of bonds listed on the New
York Stock Exchange, thereby causing
sharp rise In prices, while new bond
issues to the amount of about $60.000,-
900 were quickly snapped up. The up
turn In the oond market had all the ear
marks Of a real major movement. as the
buying was of the most confident sort.
apparently coming from investors who
had analyzed the world situation as a
whole and found a sound basis for
hopeful view.
During the week call money declined
to the lowest level in many years and
on several days the pressure of funds
on the call market resulted in substnn-
tial amounts being offered privately at
rates below those on the New York
Stock Exchange. That plentiful supply
of money and the steady betterment of
the banking position of the country APP
parently have caused many investors who
have been holding off to become con-
vinced that the shortage OF capital for
Investment has been largely exaggerated
ana IfldL Tne perlOu Oh NlSn HileItcl Iutcr
Is very near Its conclusion.
Whereas II had become more or less
OF an accepted fact that corporate
financing would be exceedingly heavy
this year, which with the demand for
American capital from abroad would
serve to keep interest rates at prevailing
levels, the belief that the credit strin-
gency is a thing of the past and that
corporations in need OF new capital can
find accommodations at their banks un-
til such time as they can do refinancing
at cheaper rates seems to be increasing.
In connection with this the National
Bank of Commerce in New York says:
Although occasional failure to secure
desired credit accommodations has
served to keep alive the impression that
there is a shortage of bank credit the
truth is that there Is now available a
volume of credit larger than present
business requires. The main requisite
for return toward normal conditions
is the will to try for business on level
where It can be had The period OF
general liquidation OF the raw material
markets of the United States has passed
Recent declines are due to conditions OF
supply and demand in specific lines.
This Is normal condition. Wholesale
prices OF many classes of manufactures
true in all lines, but recent cuts in the
price of steel and widespread reductions
In wages indicate that adjustment In
wholesale prices will not be long delayed.
Retail prices show wide Irregularities
and high cost stocks have been largely
disposed OF. Price stabilization Is.
therefore, not far ahead"
The feature of the investment mar
ket last week was the large number OF
public utility offerings, all Of which
were heavily oversubscribed. Public
utility financing amounted to about
$40, 500. 900. divided among five corpora
tions. They were s4.o0o.00o Of the De-
troit United Railways first mortgage
collateral per cent. gold bonds, S2.-
100000 Of the East Bay Water Com
pany's III per cent gold bonds. S6,000,-
600 of the Cincinnati Gas and Electric
Company's convertible s per cent Sc
cured gold notes. ss.000,000 OF the
Brooklyn Edison Company's per cent.
general mortgage bonds and s5.000.00O
of the Cleveland Electric Illuminating
Companys twenty year per cent gold
debentures.
Tho municipal bond market was
marked by a large increase In new
financing. all OF which was well re-
ceived.. New financing by our States and
cities totalled approximately s2T.o0o,00o,
Including several small issues. Maine
sold 1000 900 OF its bonds, Oregon s2.-
100000 of It's bonds. the State OF Wash
ington s3.000,000 of its bonds. Chicago
$4,000 900 of its sanitary district issue,
Cleveland si.333,o00 OF It's bonds, Min
neapoiis s1.230,0o0 of Its bonds and To-
ledo s1.760,000 of Its bonds. There
were also a score OF smaller issues. The
Canadian Province of Alberta sold ST.
5000 OF It's bonds.
In its review OF the municipal bond
market the Bond Buyer says: THE
municipal market has taken on an en-
tirely new appearance IN the last week
or so, and is beginning to look pretty
good to those who were inclined to be
pesslnistic on the outlook for the next
month or six weeks Going back over
the record for the month with particular
reference to the last two weeks, one cam
not help but be impressed by the in
sistcnt demand which has existed for mu-
ncipals. Issue after issue, regardless
or size maturity or other details, has
been sold out with apparant ease until
the list of the months new issues has as
susned the proportions OF the municipal
holdings OF the New York Life Insurance
Company"
Industrial financing is practically at a
standstill. Last weeks only offerings In
that class were $4,000 OF the welch
Grape Juice Company's closed first mort
gage ten year per cent. consolidated
gold bonds and 100000 Of the Kokomo
steel and Wire Company's per cent.
serial bonds. The Otis Steel Company, II
Is reported, will ask its stockholders to
create s15.ooo.ooo mortgage. with au-
thority to sell In the near future $4,000
900 OF bonds based on the property af-
fected by L.