Evening star., 1927-04-21
RED|SCOUNT RATE
CUT HELD POSSIBLE
Bond Trading Stimulated by
Bank of England Action.
u. S. Issues Advance.
By CHARLES F. sPEARE.
Special Dispatch 10 The star.

Special Dispatch 10 The Star.
NEW YORK, April 21.-The possihii-
itY that the Federal Reserve redjs.
count rate may be reduced AT once
ioHoWlng the lower rate established 10.
aay by the Bank of England. stinu.
iated The market for investment issues
today.
The effect OF this was nrono,rcaa
on United States Government honds
which have been sluggish for several
weeks The United States Treasury
. as advanced y after selling yester
day : points under their high of a
month ago The other l0ng.term Gov
ernments were strong and active.
Easier money prospects were also
helpful to the legal rails and p,1hlsn
utilities, which were up 4 to u point
New municipal issues. about TO be Of
tered at the lowest income basis i'm
Years for such bonds, are expected 10
20 off quickly in view of the more IA.
FoFaoie turn in the money situation.
japanese Group Unsettled.
In contrast with these conditions
was the uusettlement again i'm the
Japanese group Of government and
municipal bonds owing to the fresh
outbreak Of banking troubles i'm ia.
pan, The government 6Ias broke
nearly point TO q level ConSidera.
Diy below that Of last week. and the
TOXIC City issues fell one-haIf ia
over point. Japanese public utiIi-
TIES were easier. There was a good
deal of liquidation i'm all Of these
bonds, and evident nervousness on the
part of holders of them because Of the
failure Of the japanese banking and
commercial situation 10 improve.
Peru i2s dropped below par again
city OF Rome 6 las were at the lowest
since the day of Offering The Italian
public utilities Is, while active, were
reactive. and fractional declines oc.
CURED in French, Belgian and Bra.
lillian isues
The speculative bond list notable
strength was indicated Chicago and
Eastern Illinois SIS reached the high.
est of the year with an advance Of
212 points in this bond since the
soft coal strike began. 1t is aDpar
ent that the effect of this strike on
earnings of the company is of less con
sequence in the minds of those who
have been buying the bonds than
that of Il possible consolidation OF
TINS road With one Of the strong
trunk lines. Because of it's high
yield this bond has been popular with
speculative bond buyers and is widely
distributed
The March quarter earnings of
Dodge Brothers showed that the in.
terest on the per cent debentures
OF the company were covered 24
times. The bonds were steady So
We're the Armour issues, agricultural
chemical 7ias and the various oil
bonds. Chicago Railway IS sold at
the highest price in many months.
Continental Securities Issue.
One of today's issues was 5 pet
cent debenture of the Continental Sc.
curities Corporation. which AS been
a successful purchaser of various Tor.
eign and domestic~ securities within
the past two years. With the deben.
lures are warrants to purchase com.
mon stock. In spite of their newness
with the American investing public.
all of the corporations of this charac.
ter that have offered their debentures
have had a very favorable response.
and the present market show pre-
miumS ranging from 312 to points
on D per cent bonds originally placed
earlier this year
Some 8 per cent Florida tax-eXempt
bonds are being offered in this market.
To the investor with an income of
$4,000 this would be equivalent to
about IA per cent on a taxable bond
and per cent where a 100000 in.
come was involved.