Evening star. [volume] (Washington, D.C.) 1854-1972, 1928-07-01

wears Charles r. SDeare.
The best way to draw picture OF
what has happened is by comparison OF
prices of leading bond issues as they
were last January and about the middle
Of June.
Taking first the highest grade railroad
mortgages, which are the choice invest
ments of individuals and institutions
we find these differences in the quota
tons represented by the highs and APP
proximate lows:
Atchison general As $685.; Balti-
more 81 Ohio first as. $685.: Burling-
ton general Is. $685., Canadian Pa
cific debenture Is. e2-3733 St Paul
general Alps, 104L4 -9734; Great Northern
SIS. l09-l04. Louisville a. Nashville uni
fed 4s, 99l4-95; New York Central de-
benture As. 97i2-92i a; Northern Pacific
Is, 1892 y: Pennsylvania general 4 IS
104Ts- 9934: Southern Pacific collateral
Is, 95-soss; Union Pacific first Is
99-941s.
These bonds six months ago were
approaching per cent income return
basis. This was prior to the advance In
the Federal Reserve rediscount rate from
3l2 per cent TO per cent. and when
most of the long-term United States
Treasury certificates we're quoted on a
municipalities were able to borrow be-
tween 800 and a 3,75 per cent yield.
New Issues Suffer Most.
The most serious disturbance and the
greatest change. however, has occurred
among those newer issues that were
brought out between September. 1927
and April, 1928 mostly with 4 u per
cent coupon rate They reflected the
greatest degree of optimism over the
future course of the investment market
In the aggregate the public utilities
were the largest borrowers at the low
rates of interest. So 1t has been in this
group that the greatest amount OF
shrinkage has occurred since discount
rates went from 3i2 to per cent and
later were advanced from 4 to Az per
cent, along with the rise in call money
to 6i2 per cent and in time loans to
534 and per cent
More than 100000 900 was put out
to the investing public by corporations
in the form of 4 q per cent obligations,
4 great many of these bonds quickly
sold above their issue price. This was
true of the public utilities, which went
to premiums of to points in the
early part of the Spring. when the
New York State Legislature was con-
sidering the ACCESSIBILITY Of admitting
the obligations of electric light and
power companies, as we'll as those of
telephone companies. to its list legal
for savings banks and trustees.
Many Bonds Below Issue Price.
The buyers of these bonds. however,
today face substantial shrinkage in
the capital which they put into them.
Not only have these securities lost all
of the early premium, but fully 80 per
cent of them may be purchased now
we'll below the prices at which they
we're originally offered. group OF %
of such issues around June is showed
an average decline Of points from
the level at which they were first Of
fered to the public. Some of the most
striking declines are given IN the quota
tons below, the first figure being tie
subscription price and the second the
quotation recently prevailing:
st. Louis-San Francisco 4i2s. 9T-89 "a;
st. Paul 4I2s l02ia-97; Union Pacific
4s, 9234 -87l2. Wabash 4i2s, 95l2-90;
Ohio Power Alps. 96-91aa; Utah Power
a. Light 4l2s. a634 90 y; Missouri-Kan-
sas-Texas 41as. 9oaA -94ia; Australian
Government 4ias, 9212-ssi2; Denmark