The Washington times., 1922-07-11
j. s. RAILROAD
BONDS POPULAR
IN EUROPE
investment Bankers Report In
fIux Of European Orders
8 For Rail Bonds.
BY MUNROE ROBERTS.


tcopyright. 1874. by Cosmopolitan News
Serviee)
NEW YORK, July l1.-Except for
the weakness that has developed in
a small number OF foreign bonds,
there is apparently no halt in the up.
ward progress Of prices OF invest.
ment bonds on the listed market.
Investment bankers are reporting an
influx OF orders for high-grade Amer
lean railroad bonds from some Of the
European countries. particularly
Holland. whose people have always
been partial to securities OF this
class. 1t is important to consider
that such bonds are removed from
the market and no longer constitute
a part of the floating supply, to be
thrown on the market at the first
sign OF q reaction In prices.
According to reports from the Fed.
eral Treasury Department the re-
duction In outstanding Liberty and
Victory bonds during the month Of
June amounted to S6l7,l2S,050, in.
cluding $3.50, AL $50 in Victory notes.
II must be remembered, however,
that the latter operation was accom-
plished quite largely by the issuance
Of new Treasury certificates and.
therefore, the net reduction of the
war loan was not as large as the
first figures might suggest.
Beyond the fact that the act under
which the war loans were issued re.
quires the retirement Of q certain
amount each year. there is no par
ticular reason why the Government
should make strenuous efforts to ac-
quire bonds in the market At the
present time. When these bonds
were selling between IS and 95, the
Government made a profit of from
$50 TO $3.50 on each 81 900 bond. With
prices above par. however, this i'm
portant incentive for their purchase
Is lacking.
Authority to issue and sell S27.645.-
900 Of equipment trust certificates at
not less than 95.495 per cent of par.
the proceeds to be applied on the pur-
chase of rolling stock estimated TO
cost S36,944,0 ,072. has been granted the
New York Central subsidiary lines by
the Interstate Commerce Commis-
sion.
The subsidiaries, which will partici-
pate in the equipment trust and have.
equipment allocated to them, are the
Michigan Central, c., c.. G. and St.
L., the Cincinnati Northern, the
Pittsburgh and Lake Erie. and the
Pittsburgh, McKeesport and Youghio-
gheny. the latter having just organ
ICED TO engage In transporting by
railroad subject to the interstate com.
merce act.
An important refunding transac.
ton Is consummated in the sale Of
the new issue OF s25 900 900 New York
Central Railroad Company per
cent refunding and improvement
mortgage gold bonds, dated October
I, 1921, and due 2013, which are Of
fered today at 94h and accrued I'm.
terest to yield approximately $50 per
cent by a syndicate headed by J. P.
Morgan & Co. The issue is redeem
able as a whole, but not in part, after
1851 at los and accrued interest.
Proceeds Of this issue will be used
to retire the s25, 900. 900 Of per cent
collateral trust bonds of the company
which will be called for redemption
on September l, 1922. The new issue
lis secured by a direct mortgage on
all OF the railroads owned by the com.
pany. The bonds are legal invest.
ment for savings banks in the States
of New York, Massachusetts,, Con-
necticut and New Jersey.
Other important offerings today
include $50o,000 Sumter county,
South Carolina, serial s per cent i'm.
provement bonds: $lsS.000 town OF
Cornwall. N. Y, AZ per cent union
free school district bonds; Sl,000,OO0
county of York, Pa, serial ~ per
cent Improvement bonds to yield 4o7
per cent.