The Telegraph-courier. [volume] (Kenosha, Wis.) 1888-1946, 1925-01-01
Foreign Loans


passes into financial history as one Of
the most remarkable on record in the
the point of new financing.
Not only did the volume of foreign
financing establish new record, but
the total of all new capital hotations
as we'll ranked among the highest in
history. Although accurate compila.
tions are not yet available, prelimin.
airy estimates indicate that public of.
ferings of all stocks and bonds during
the year appropriated S6,000.o00,0 900
lcontrasted with about $4,700, 900 900 in
1923.
Foreign bonds ran close race with
state and municipal offerings for first
place in the amount of new business
handled. Flotations of the latter, ag-
gregating almost $1,400,0 900 eclips-
ed all previous records, while the lat
est figures on foreign loans indicated
that the total would reach slightly
more than $1,200,000,00O.
Trading in the bond market through
out the year was marked by a progress
Isive forward movement, governed large
ly by the easy money situation. AS
1924 drew to close the price average
of 40 representative issues was the
highest in several years and approx
mately six points above the low mark
reached early in the year.
An abundance Of idle funds, attest
ed by gradual reductions in the rates
for time and call money and three
cuts in the New York Federal Re-
serve Banks rediscount rate, contrib
uted to the bond markets strength.
The flow of idle cash into investment
securities carried the price of u. S.
government obligations we'll above par
and brought about steady apprecia-
tion in the quoted values of all types
of corporation and foreign government
| issues.
The NEST striking performances Of
the year were given by semi-specula-
tive railroad bonds, which led the mar
ket in turnover and in the extent of
individual gains. The great improve
ment in the general railroad situa-
ton during the year, which is reflected
in the leading part played by rail
shares in the post-election stock mar
ket boom, also enlivened trading in
the bonds of the carriers. Net gains of
30 points or more for the year were
scored by some of the income and adj
justment liens, most directly affected
by favorable earnings and dividend de-
velopments.
Maintenance of easy money rates
throughout the year resulted in the
saving of millions of dollars to foreign
tions, which carried out extensive re-
| funding operations at lower interest
charges. The bulk of more than $780,
100000 in bond and note offerings by
the government Of Argentina was used
to retire maturing issues. The larg-
est refunding program completed dur
ing the year was by the Baltimore &
Ohio railroad which sold more than
l$100,000,000 in new bonds to meet
1925 maturities. Satisfactory progress
was reported late in the year by the
New Haven and st. Paul railroads on
their 1925 refunding plans.
The prompt absorption of new fnanc-
ring was one of the favorable develop
ments of the investment market. At
no time during the year did the mar
ket experience difficulty in digesting
new issues, despite the expansion in
business. With the investment APP
petite whetted by the ease of money,
virtually all offerings were oversub-
scribed, many of them three or four
times. An unusually large number of
high grade note issues was placed
privately among institutions without
recourse to public offering.
A fair measure of the investment de-
mand was supplied by the heavy over
subscription Of the United States
Treasury's long-term four per cent
bond issue to which the government
turned late in the year after financ-
ing it's requirements for several years
by short term notes. Within a few
days subscriptions for the issue, on
which cash purchases were limited to
S200,000,000, had exceeded $1,000,000,-
900. Bankers estimated that total sub
scriptions, including the exchange of
third Liberty four and one-fouth per
cent bonds and maturing certificates,
would run close to 100000 900.
Overshadowing all other individual
bond offerings in Importance and wide
spread interest was the American par
ticipation in the international loan to
Germany. The $110,000,000 portion of
the 100000 900 financing offered in
the United States was more than five
times over-subscribed and public de-
mand for the bonds enabled them to
command substantial premium in
stock exchange trading.
The largest single piece of financing
was the $150,000,000 Japanese recon-
struction loan, which was foated ear
ly in the year and several times over
subscribed. The S100,000,000 loan to
France late in the year, which replaced
credit of similar size extended by
j. P. Morgan Co., to stabilize the
franc, ranked third in size.
The government of Argentina was.
the most frequent borrower in the
American market during the year, plac-
ing FIVE separate bond and note is
sues aggregating more than 100000
900. Other prominent foreign borrow
ers were Mexico, $50,000,000; Holland,
$40,000,0G0; Belgium, Sweden and
Switzerland, $S0,OOo,000 each; Norway,
SIS 100000 and Hungary, $7,500,000.
The year witnessed the placing in
operation and subsequent collapse of
tie Mexican debt agreement, when serv-
ice on the $500,000,000 debt was de-
faulted on July I. Late in the year
prospects for resumption of serv-
ice frightened when it was reported