The Washington times., 1922-07-03
PRICES
LOOKED FOR IN
BOND MARKET
Advance of Investment Bonds
Which Have Jagged Be-
hind Predicted.
BY ACKNOWLEDGEMENTS.

Copyright, 1879. by Cosmopolitan News
ServiceD
NEW YORK. July 3.-Reduction
in the official discount rates OF the
banking institutions on both sides OF
the water, the piling up Of the liquid
resources OF banks and investing in
stitutions and the completion OF the
July l settlements should constitute
a combination of forerunners to
more activity and higher prices for
prime investment securities, and 1t
should require neither a prophet nor
the son of a prophet to forecast the
"evening up" of investment bonds
which have Jagged behind the mar
ket in recent weeks. If it is logical
to look for a falling off in business
on the listed stock market, the same
logic should not apply to the market
for investment bonds. The current
advance on Liberty bonds is crafty
ing from every standpoint, not the
least Of which is the fact that the
status of these bonds as collateral
for loans has improved 20 per cent
during the course OF their upward
progress in the market.
1t is understood that one OF the
impediments to the success of foreign
loans in this country is the desire of
foreign governments to have new is
sues put out in their own currencies
and made payable in these currencies
rather than in American dollars.
With the present unsteadiness OF
foreign exchange and the almost GER
tainty of the reputation of a num-
Der of currency tokens" now out
standing, II is expected. of course. en-
tirely unthinkable that American in
vestors should be advised to purchase
securities, the ultimate value Of
which Is a matter of such serious con
cern. In the last analysis. the in
vestment houses are simply the me-
dunn through which loans are trans
ferred from government borrowers to
the ultimate consumer" the inves.
tor who buys small blocks Of bonds
at retail. Should there be strong
probability of English pounds and
French francs coming back to a rate
approXimatinR normal, investors
would. of course. have a double op.
portunity for profit: but this Is large
ly problematicla. especially in the
case OF the latter. The State Depart
ment at Washington has already
given this matter very careful con-
sideration, but as yet has not deemed
1t necessary to take any steps In the
interests Of American investors.
According to the authentic com
pilation OF the Journal Of Commerce
In New York. foreign bonds brought
out In the American market during
the first half Of 1922 aggregated $685.
4lS.125. This total stands as a new
high record for a similar period since
the armistice, at least. The largest
total recorded for any one month was
during April. when the aggregate OF
foreign bonds put out for public sub.
scription was $209, 100000 Included
In this figure was the $100, 900. 900
Dominion of Canada per cent loan.
Next in point of size was Marc h
which showed an aggregate of S1S4..
10000. which included the Kingdom
of Netherlands guilder issue and s3O..
OOO,OOO Paris-Lyons-M s-Mediterranean 6
per cent bonds. Dutch East Indies 6
per cent bonds were also brought out
TO the amount of $40 200, 900.
To the grand total, January con-
tributed $90, 0,425 900. of which S4O,-
10000 represented the first block
of Dutch East Indies business
brought out. The Department of
the Seine came into the market for
s25'ooO,0Oo. February resulted in
new foreign financing to the
amount of but SIS 5,241,725, Of which
the Queensland per cent twenty.
five-year bonds took $4,000, 900.
The total for May stood at s62..
S25,OOO and presented few outstand-
ing features but a variety of busi-
ness in moderate proportions. June
contributed $123,290,OOO to the
grand total and. incidentally, ac-
cording to the prevailing belief in
the financial district. furnished the
real reason for tie halt in activity,
The fact that two foreign govern.
Ihent issues are at present still
| open for subscription mas had n
generally SOLDERING effect on the
mad rush on the part of banks to
secure new business.