Evening star., 1924-06-29
BOND PRICES STILL 3
UNDER 1922 LEVELS
Also Over Seven Points Be-
low 1917 Average in Spite
of Weeks Big Gains.
HALT NOT YET IN SIGHT
Money Rates and Earnings Reports
Among Chief Factors Being
Watched.
HALT NOT YET IN SIGHT
BY GEORGE II. HUGHES.

Special Dispatch to The Star
NEW YORK, June 2s.-There hae
been no interruption this week to
the steady advance in the price in.
Vestment securities. AS 1t stands now
the average quotation for bonds is
around the high of the year In many
lhalVldual issues new high records
have been made.
Money Rates First Factor. ~
In the nature of things. no posifive
answer can be given to the question
of how far the rise is likely to re:g
There are, however. a number of fac
tors IN the problem tho examination
or which may prove helpful First Of
an, or course. is the money situation
this dispatch that money rates for
poth cail and time funds were re-
markably low, and that the supply q
was greater than the demand De-
Velopments this week show that this
surplus is still increasing.
II is true that there has been no
change in the quotation for can
money on the stock exchange, which
mas ruled steadily at per cent: bur
time money, the charge for which is
At the close of the week accommo-
dations for sixty days were quoted
at from 212 to "a per cent and banks
ers acceptances made new low.
record for the New York market.
There is then nothing in money con-
dittons to suggest a change in the
trend of bond prices. ="
modities Unsettled.
A second very important considera
tion is that Of commodity prices. Here
the outlook is not so clear There
nave been sharp advances in grain
and there is much better feeling in
the sugar trade. On the other hand,
the low; Opinion in the industry is
that prices are around the bottom
but this opinion has been heard be-
fore. The same is true of copper.
were perhaps Europe's ability to
buy remains TO be demonstrated. a
declining tendency in commodities Is
generally accompanied by an advance
IN bonds The reaction, however, Is
not SO immediate as is the case with
changes in the money market.
IhlrdIy, we have to consider the
business outlook as evidenced by the
demand for credit and the influence
upon sentiment of earnings state
ments. About all that can be said
along this line is that the feeling Is
much more cheerful this week than
a week ago. Testimony to this effect
comes from the action of railroad
stocks and the lower grade of rail
road bonds. Almost without excep-
ton the carriers that have reported
for Man make unfavorable compari-
sons with the same month year
ago.
There are exceptions, but they arc
few. In some cases the drop has
been very sharp. rejecting the traffic
reaction. Nevertheless no attention.
whatever has been paid to these re-
ports by the market Instead. there
mas been active buying of railroad
securities, probably both for the
speculative and investment accounts
theory that the market is discount
ing a turn for the better
This matter OF earnings is OF i'm.
portance only to the more speculative
securities High grade investment
stocks and bonds move independentIy
of the temporary fluctuations Of
income statements. The point is
that the dividing line between these
two classes is never fixed, but rather
constantly shifting. In an advancing
prices for gilt-edged obligations
reach certain level on an upward
movement there is a turning toward
those where the yield is little
higher, even though the quality Is
not quite so good. Obviously. I'M
opportunities for investment selec-
ton and apparently buyers this week
believe that such Improvement is on
the way.
No Reaction I'm Sight.
Summing it all up, under none of
these heads can be found any reason
to expect any considerable reaction
In the investment market. AS mat
ter of fact although bond prices are
now at the high of the year, they are
still nearly three points below the
high average of 1922 and seven anu
a half points below the high averaEe
of 1917. 1t seems reasonable to ex-
pect that some approach to the
records of these two years will be
made before all the conditions that
make for the present strength have
been fully discounted.