Every evening, Wilmington daily commercial. (Wilmington, Del.) 1878-1928, 1922-07-22

wellesley Hills. Mass, July 22-
While discussing the opportunit'e" IN
the present bond market, Roger w.
Babson, the stntistlcian, today made
the following statement regarding the
future of municipal issues.
The past few years." says Mr. Bah
son. have been hard for cities and
towns desiring to borrow money. Dur
ing the war an unwritten ban wns
placed upon municipal borrowing and
unnecessary public building. Directly
after the war money was scarce and
rates were high. II has only been with
in the last few months that cities and
towns have been able to secure what
money they have desired at fair
rate. Municipal fathers. contractors.
and investors are now wondering
whether the present decline In ra,ee
Ia temporary or will extend over sew
eral years.
study of the situation leads mo to
believe that the present decline In In
tcrest rates will continue and that
cities and towns will be able to Dor
row freely during the next few years
Il even looks as IL city fathers VIII
soon be solicited by bond houses for
issues to sell. Up to the present time
city officials have been obliged To hunt
up banks to buy their securities The
time will soon come when the bankers
will he sending buyers throughout the
country 10 hunt up bond Issues that
they can sell. The next few years Will
see n scramble for bonds on the part
of the dealers far greater than any
previous scramble for money on the
part of the cities and towns. The law
of business cycles still operates. As
we have had years of advancing in
| ,crcat rates we will have years of dc
| Clining interest rates. Moreover. thca'
| cyclee cannot lac suspended or changed
| any more than we can suspend on
change the tides OF tho ocean.
| I'm addition 10 tho law Of business
| cycles, the tax situation la very much
In favor OF municipal borrowing. Re
fore the days Of income taxes nn'
surfaces. bonds of our best citic
sold on a 3iz basic, and even better
Now, when wealthy men are obige'
to pay surfaces Of from 30@c TO 50P
these tax exempt bonds Of cities an
towns should be in great demand. Som
of my associates even state that man
of these bonds may go up until the
, are on 2i5 y basis. or less. or coure-
4 this also applies to the Governmer
honde. although tho Government bond
q are rather short time and therefor
, not 40 attractive 10 the investor.
Cities and towns will temporarily |
, greatly benefited In their borrowir
g by any amendment 10 the Constitute
making all bonds taxable. II such legii
. lation is attempted. there naturally w
10 a lot nf tax exempt bonds put q
. the market juat preceding such legi
lation. Some feel that such n food
: securities would depress tho price. b,
others believe that II they are 10
= tho laet Of tax exempt securities. q
market will absorb easily all they q
fer. Whichever Ia tho case cities M
= towns will have no difficulty In dlspo
Ing of their securities during the ne
y fow years. and tho interest rat
y should steadily and continually q
II cline.
d This means that municipaliti
y should Immediately adopt civic pla
IT ming schemes" continued Mr.. Babso
and probably should make during q
y next five years. such improvements