Evening star. [volume] (Washington, D.C.) 1854-1972, 1930-01-31
NEW BOND ISSUES
IN LARGE SUPPLY
Average for List Declines
Slightly During Month
as Offerings Gain.
Special Dispatch to The star.

Special Dispatch to The Star
NEW YORK, January 31.-The frs
month of the new year in bonds was
distinctive for the volume of offerings
| by corporations rather than for any
definite improvement in the price
trend. In fact, old issues were de-
pressed both by the amount of new ones
coming into sight and their more at
| tractive terms afforded to investors
This resulted in shifting on con-
siderable scale While this was in prog
resS the average of the domestic bond
list declined nearly point from the
level to which it had advanced in De-
cember.
Until the new financing again as
sumes moderate proportions there will
be conflict between Syndicated bonds
and those that have been long dis
tributed and easier money conditions
will not have their full influence on
values. After famine in the invest
ment field has come the usual food of
securities with underwriters again COM
peting with each other for attractive
bonds. The shelves Of dealers long
bare are beginning to fill up once more.
The policy of those sponsoring new is
sues has been to make them so at
tractive in price and yield that there
will be no question of their success.
The bonds had to go if the market
was to be dragged out of its rut This
explains the price of 9915 fixed on the
$3.50 900 900 of American Telephone 81
Telegraph SIS of the same issue that
previously had been selling at 104; also
the quotation on others which was well
below that of companion bonds. The
strategy of the situation was the re-
verse of two years ago when new issues
were priced above old issues instead
of below them and went stale. The
public then was shrewd enough to see
that 1t was being asked to pay pre-
MUM for the same securities that 1t
could buy at discount.
Character Of Demand.
The demand for both old and new
bonds has so far been an institutional
one. The general public has not been
an important buyer, for it is still in
volved in the stock market as holder
of securities on which there Is a depre-
citation or else it exhausted its funds
in buying stocks in the breaks of Octo-
Der and November. 1t will be some
time before this element becomes a
source of support for fixed interest OBJ
legations. The institutions, however,
have been building up their reserves
since the middle of November and are
now in position to consider attractive
offerings. Life insurance companies
were the largest single participants in
the American Telephone & Telegraph
issue and in several of the smaller high
grade public utility offerings that fol-
lowed it. The savings banks have ex-
perienced an increase in their deposits
since the drain on them ended late in
November and have been able to repur-
chase some of the bonds which they
were forced to sell when the public
was withdrawing funds heavily last Au-
tumn.
There is a marked contrast in the
character of new financing at the
present time. The greater part of it
is in bonds, whereas last year it was in
stocks. Again most of the bonds have
been either straight debenture or mort
gage issues with no warrants or con-
vertible attachments. During the period
Of four weeks in which municipal and
corporation bonds totaled between
$650, 100000 and $700,00o,00 there was
no common stock issue of Importance.
Neither has there been much employ
ment OF preferred stocks as vehicles
for financing in spite of the fact that
the average advance in senior shares
has been greater than in domestic