Omaha daily bee. (Omaha [Neb.]) 187?-1922, 1922-01-27
Financial
Chr Nelu 1]ork Gimes.
BY ALEXANDER DANA MOVES


New York. Jan. 26.-The federal
reserve systems ratio OF reserve 20
notes and deposits rose in today's
statement TO the highest percentage
since the month in which we went TO
war with Germany.
The same comparison holds with
the increased ratio OF the New York
reserve bank. Like other recent
weeks, this one was marked By rela-
lively slight increase in the systems
gold reserve, but note circulation and
rediscounts were heavily reduced ;
they are now lower respectively BY
S259,0o0.00o, and $500, 100000 than at
the end OF 1921 and by Sl,6s0, 000.-
600 and S90o,Oo0,0o0 than year
ago.
On the stock exchange the result
OF the overriding OF their work BY
professional manipulators was indi-
Gated in general decline. mostly
faetional, but in some of the recent
subjects OF speculation from | to 3
points. Exchange on European con-
tinentai markets was in most cases
lower, but sterling touched S4.23 for
the first time in a fortnight. The
fall in cotton to the lowest since
last August-today's spot price OF
1910 cents was touched only once
in the intervening period, on Novem-
Der l2-was the outstanding event in
commodity markets. The trade is
evidently postponing purchases,
whether wisely or not, we shall know
later on.
Rises and Declines.
There wero both advances and declines
in the market for investment bonds: 1t
was not easy TO trace a general tendency.
While the Liberty bonds in general de-
elined a fraction, the Pictory AZ per
cents rose to 800 30, the highest price
ever reached by them. The advance was
caused by tho treasury's highly important
announcement in connection with its Of
fer of si0o.o00.oo0 new 3-year notes.
that Victory bonds OF the 1919 loan Will
not only be received in payment in lieu
Of cash for subscription to that amount,
but will be accepted for an additional
$500 Oo0, 000. Since the Victory bonds fall
due May 20. 1928, and the new short notes
in March, 1925. such conversion would be
equivalent to an extension OF not quite
two years in the life Of the bonds used
for such subscription.
Victory Loan Repayment.
The purpose of this conversion is clear.
The Victory loan, amounting originally to
S4,495, 600, has since been reduced
through treasury repurchases to $685.
10000, but even redemption between now
and date of maturity at similar rate
would leave more than s2,50o, o00.O 900 for
payment or refunding a year from next
May Any such amount as Secretary Mel
Ion stated in his letter to the house COM
mittee earlier in the week is too large
to pay off or refund at any one time,
hence, the treasury's policy Of extending,
through the proposed 5000. 900 CONVEX
sion, the maturity of some hundreds Of
millions of the outstanding Victory loan.
That the price of the outstanding Vic
tory bonds should have advanced on the
announcement was due to the fact thai
the near maturity Of the existing loan,
IL is in fact subject to call for payment
at par next June-has barred any very
considerable premium and had kept away
the larger investing institutions. The an
nouncement is, however. still more inter-
esting as the first step in the intricate
program for refunding the war debt. That
great operation will. for many years. exact
the highest skill and ingenuity of our
financiers